Agenda - Council - 09/13/2016 - Laserfiche WebLink

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City of Ramsey August 10, 2016 Page 4 If information from a component unit is required to be included in the City's financial statements, we will not audit the financial statements of components of which we were not engaged as auditors as of and for the year ended December 31, 2016. Those financial statements will be audited by other auditors whose reports thereon will be furnished to us. We will communicate with the other auditors and reference their audit of the component(s) as necessary. Information from the group component audit will be included in the City's financial statements based on materiality, significance to the audit, and auditor judgement. Audit Procedures — Internal Control Our audit will include obtaining an understanding of the government and its environment, including internal control, sufficient to assess the risks of material misstatement of the financial statements and to design the nature, timing, and extent of further audit procedures. Tests of controls may be performed to test the effectiveness of certain controls that we consider relevant to preventing and detecting errors and fraud that are material to the financial statements and to preventing and detecting misstatements resulting from illegal acts and other noncompliance matters that have a direct and material effect on the financial statements. Our tests, if performed, will be less in scope than would be necessary to render an opinion on internal control and, accordingly, no opinion will be expressed in our report on internal control issued pursuant to Government Auditing Standards. An audit is not designed to provide assurance on internal control or to identify significant deficiencies or material weaknesses. However, during the audit, we will communicate to city or group management and those charged with governance of the city or group, internal control -related matters that are required to be communicated under American Institute of Certified Public Accountants (AICPA) professional standards and Government Auditing Standards. Audit Procedures — Compliance As part of obtaining reasonable assurance about whether the financial statements are free of material misstatement, we will perform tests of the City's compliance with the provisions of applicable laws, regulations, contracts, agreements, and grants. However, the objective of our audit will not be to provide an opinion on overall compliance and we will not express such an opinion in our report on compliance issued pursuant to Government Auditing Standards. Management Responsibilities Management is responsible for establishing and maintaining effective internal controls, including evaluating and monitoring ongoing activities, to help ensure that appropriate goals and objectives are met; following laws and regulations; and ensuring that management and financial information is reliable and properly reported. Management is also responsible for implementing systems designed to achieve compliance with applicable laws, regulations, contracts, and grant agreements. You are also responsible for the selection and application of accounting principles, for the preparation and fair presentation of the financial statements and all accompanying information in conformity with accounting principles general accepted in the United States of America, and for compliance with applicable laws and regulations and the provisions of contracts and grant agreements.