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<br />· Audit Summary <br />o Audit Summary and Findings: <br />· MMKR has issued an unqualified opinion on the City's financial <br />statements. <br />· MMKR noted no matters involving the City's internal control over <br />financial reporting that they consider to be significant deficiencies or <br />material weaknesses. <br />· The results of the testing disclosed no instances of noncompliance that are <br />required to be reported under Government Auditing Standards. <br />· MMKR noted that the Schedule of Expenditures of Federal Awards is <br />fairly stated, in all material respects, in relation to the basic financial <br />statements. <br />· The results of the tests indicated that the City has complied, in all material <br />respects, with the requirements applicable to each major federal program. <br />· MMKR noted no matters involving the internal control over compliance <br />and its operation that MKR considers to be material weaknesses in their <br />testing of major federal programs. <br />· MMKR has reported two findings based on their testing of the City's <br />compliance with Minnesota laws and regulations: 1) payment of invoices <br />need to be within the 35 day required time period; 2) language missing <br />from contract requiring the contractor to pay any subcontractor within 10 <br />days of the prime contractor's receipt of payment from the City. <br />· Funding Cities in Minnesota . <br /> <br />Counci1member Strommen arrived at 5:30 p.m. <br /> <br />Mr. Malloy provided an overview of the following additional information from the City of <br />Ramsey 2006 CAFR Management Report: <br />· Governmental Funds Overview <br />· Financial Trends and Conditions <br />· Accounting and Auditing Updates <br /> <br />Mayor Gamec noted there has been a push in regards to cutting back on fund balance reserves; <br />however, for the City to achieve this payment would be needed from the State more frequently. <br />He asked if there is a recommendation regarding the reserves. <br /> <br />Mr. Malloy replied the State Auditor at one time suggested at least 50% of expenditures as the <br />fund balance reserve. However, with this amount in reserve, the City would be at a point with <br />zero cash balances, and would then be internally borrowing from other dedicated funds such as <br />debt service funds, which is notto be done. His opinion is that the City's fund balance is in good <br />shape, and it is important to maintain that type of balance. <br /> <br />Finance Officer Lund clarified in relation to debt service, the City has not issued debt service for <br />Ramsey Town Center development; it is strictly for the municipal center. <br /> <br />City Council Work Session / June 26, 2007 <br />Page 2 of 10 <br />