Agenda - Council - 08/08/1989 - Closed Executive Session and Regular Meeting

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City Council and Residents May 23, 1989 It is our opinion that the new finance officer has made a good faith effort to improve the financial conditions as she found them, but given the demands on her time, progress has been difficult. We strongly recom- mend that the City evaluate its personnel needs and consider alternatives which would allow the Finance Department to "catch-up" on the daily accounting functions. At the present time, six months into the new year, we see that the department is not in a position to improve upon its con- dition. If assistance is not found, we feel that conditions will only worsen. Prior Year Comments Because of the problems mentioned above, we would like to restate the following three comments from the prior year. We believe they relate to important issues that should be addressed as soon as it is feasible. 1. Fixed Asset Records General fixed asset records (non-enterprise funds) of the City are maintained on a manual system which is updated at the end of each year. This system does not provide automa- tion of information flow such as sorting and totaling abili- ties. It does not provide information such as condition and status records for capital planning. Also, by not updating the system on a current basis (immediate or at least month- ly) information becomes less reliable and creates a burden- some and difficult task in preparing for the annual audit. These records should be automated and capital outlay items should be identified upon purchase and added to the fixed asset system at that time. 2. Special Assessments Currently, the City's financial statements reflect only those special assessments that have been levied but not paid. Technically, the City should be reporting all assessments that are outstanding. This would provide additional information to financial statement users which would allow them to analyze the City's future special assessment revenue potential in relation to debt or deficit fund balances. Since during 1988 the City converted its special assessment accounting records to a computerized system and agreed the totals to County records, we recommend that during 1989 the City record all outstanding assessment balances on its general ledger.