Mikunda, Cottrell & Co., Inc.

Transcription

1 SINGLE AUDIT SECTION 11 9

2 =::;::::; Mikunda, Cottrell & Co., Inc. Certified Public Accounlan ts & Consultants RSM McGladrey Network An ~ I}Mled MeIrbe" Offices in Anchorage & Kenai Independent Auditor's Report on Internal Control Over Financial Reporting and on Compliance and Other Matters Based on an Audit of Fi nancial Statements Performed in Accordance with Government Auditing Standards Honorable Mayor and City Council We have audited the accompanying financial statements of the governmental activities, the businesstype activities, each major fund, and the aggregate remaining fund information of the City of Palmer, Alaska, as of and for the year ended December 31, 2007, which collectively comprise City of Palmer's basic financial statements and have issued our report thereon dated June 6, We conducted our audi t in accordance with auditing standards generally accepted in the Uni ted States of America and the standards applicable to financial audits contained in Govemmelll Auditing Standards, issued by the Comptroller General of the United States. Internal Control Over Financial Reporting In planning and performing our audit, we considered City of Pal mer's internal control over fi nancial reportin g as a basis for designing our auditing procedures for the purpose of expressing our opinion on the fin ancial statements, but not for the purpose of expressing an opinion on the effectiveness of the City's internal control over financial reporting. Accordingly, we do no express an opinion on the effectiveness of the City's internal control over financial reportin g. A control deficiency exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent or detect mi sstatements on a timely basis. A significant deficiency is a control deficiency, or combination of control deficiencies, that adversely affects the entity's ability to initiate, authorize, record, process, or report financial data reli ably in accordance with generall y accepted accounting principles such that there is more than a remote likelihood that a mi sstatement of the entity's financial statements that is more than inconsequential wi ll not be prevented or detected by the entity's internal control. A material weakness is a significant deficiency, or combination of significant deficiencies, that results in more than a remote likelihood that a material mi sstatement of the fi nancial statements will not be prevented or detected by the entity's internal control. Our consideration of internal control over financial reporting was for the limited purpose described in the first paragraph of this section and would not necessarily identify all deficiencies in internal control that mi ght be significant deficiencies or material weaknesses. We did not identify any deficiencies in in ternal control over financia l reporting that we consider to be material weaknesses, as defined above "C" Street, Suite 600 Anchorage, Alaska (907) Fax (907)

3 Honorable Mayor and City Council Compliance and Other Matters As part of obtaining reasonable assurance about whether City of Palmer's financial statements are free of material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts and grant agreements, noncompliance with whi ch could have a di rect and material effect on the determination of financial statement amounts. However, providing an opinion on compliance with those provisions was not an objective of our audi t and, accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance or other maners that are required to be reported under Gavemmenl Auditing Standards. This report is intended solely for the information and use of City of Palmer's management, Honorable Mayor and City Council, and appropriate federal awardi ng agencies and pass-through entities, and is not intended to be and should not be used by anyone other than these specified parties. Anchorage, Alaska June 6,

4 Mikunda, Cottrell & Co., Inc. CCJ'lificd Public Accountants & Consullan LS =' RSM McGladrey Network 111 ~Owned I4enUr Offices in Anchorage & Kenai Independent Auditor's Report on Compliance with Requirements Applicable to Each Major Program and on Internal Control Over Compliance in Accordance with OMS Circular A-133 Honorable Mayor and Cit y Council Compliance We have audited the compli ance of City of Palmer with the types of compli ance requirements described in the U.S. Office of Managemelll and Budget (OMB) Circular A-J33 Compliance SlIpplemeJII that are appl icable to each of its major federal programs for the year ended December 31, The City of Palmer's major federal programs are identified in the summary of auditor's results section of the accompanying Schedule of Findings and Questioned Costs. Compliance with the requirements of laws, regulations, contracts and grants applicable to each of its major federal programs is the responsibili ty of City of Palmer's management. Our responsibility is to express an opinion on City of Palmer's compliance based on our audi t. We conducted our audit of compliance in accordance with auditing standards generally accepted in the United States of America; the standards applicable to fin ancial audits contained in Government Auditing Stal/dart/s, issued by the Comptroller General of the United States; and OMS Circular A- 133, Aut/its of Slates, Local Governments, alld Non-Profit Orgal/izations. Those standards and OMB Circular A-133 require that we plan and perform the audit to obtain reasonable assurance about whether noncompliance with the types of compli ance requirements referred to above that could have a direct and material effect on a major federal program occurred. An audit includes examining, on a test basis, evidence about City of Palmer's compliance with those requirements and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis fo r our opinion. Our audit does not provide a legal determination on Cit y of Palmer' s compli ance with those requirements. In our opinion, City of Palmer complied, in all material respects, with the requirements referred to above that are applicable to each of its major federal programs for the year ended December 3 1, "C" Street, Suite 600 Anchorage, Alaska (907) Fax (907) www. mcc-cpa.com

5 Honorable Mayor and City Council Internal Control Over Compli ance The management of City of Palmer is responsible for establishing and maintaining effective internal control over compliance with the requirements of Jaws, regulations, contracts and grants applicable to federal programs. In planning and performing our audit, we considered City of Palmer's internal control over compliance with requirements that could have a direct and material effect on a major federal program in order to detennine our auditing procedures for the purpose of expressing our opinion on compliance but, not for the purpose of expressing an opinion on the effectiveness of internal control over compliance. Accordingly, we do not express an opinion on the effectiveness of City of Palmer's intern al control over compli ance. A control deficiency in an entity's internal control over compliance exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent or detect noncompliance with a type of compliance requirement of a federal program on a timely basis. A significant deficiency is a control deficiency. or combination of control deficiencies. that adversely affects the entity's abi lity to administer a federal program such that there is more than a remote likelihood that noncompliance with a type of compliance requirement of a federal program that is more than inconsequential will not be prevented or detected by the entity's internal control. A material weakness is a sign ificant deficiency, or combination of significant deficiencies, that results in more than a remote likelihood that material noncompliance with a type of compliance requirement of a federal program will not be prevented or detected by the entity's internal control. Our consideration of internal control over compliance was for the limited purpose described in the first paragraph of this section and would not necessarily identify all deficiencies in internal control that might be significant deficiencies or material weaknesses. We did not identify any deficiencies In internal control over compli ance that we consider to be material weaknesses, as defined above. This report is intended solely for the information and use of City of Palmer management, Honorable Mayor and City Counci l, and appropriate federal awarding agencies and pass-through enti ties, and is not intended to be and should not be used by anyone other than these specified parties. Anchorage, Alaska June 6,

6 CITY OF PALMER, ALASKA Schedule of Findings and Questioned Costs Year Ended December 31, 2007 I. Summary of Auditor's Results: Financial Statements: Type of auditor's report issued: AUDIT RESULT Unqualified Internal control over financial reporting: Material weaknesses identified? Significant defi ciencies identified thai are not considered to be material weaknesses? Noncompliance material to financial statements noted? ----yes..lnane reported _yes..l no Federal Awards: Internal control over major programs: Material weaknesses identified? Signifi cant deficiencies identified that are not considered to be material weaknesses? Type of auditor's report issued on compli ance for major programs: Any audit findings disclosed that are required to be reported in accordance with section 51O(a) of Circular A-l33? Unqualified -yes--l no Major programs: Agency Department of Transportation Department of Justice Department of Homeland Security Environmental Protection Agency CFDA Number Program Palmer Municipal Airport TriBorough Alaska Land Mobile Radio Homeland Security Grant Cluster Alaska Clean Water Loan II. Dollar threshold used to distingui sh between Type A and B programs Low-ri sk aud itee Financial Statement Findings $300,000 Yes None noted III Federal Awards Findi ngs and Questioned Costs 124 None noted

7 CITY OF PALMER, ALASKA Summary Schedule of Prior Audit Findings Year Ended December 3 1, 2007 There were no prior year audit findings. 125

8 CITY OF PALMER, ALASKA Correcti ve Acti on Pl an Year Ended December 3 1, 2007 There are no current year fi ndings; therefore no corrective acti on plan is required. 126

9 ~ Mikunda, Cottrell & Co., Inc. Ccnified Public Accoumams & Consultants RSM McGladrey Network NI RleJ!eKle!ttrOM'l!d ~ Offices In Arn:horage & Kenai Independent Auditor's Report on Internal Control Over Financial Reporting and on Compliance and Other Matters Based on an Audit of Financial Statements Performed in Accordance with GovemmeliI Auditing Standards Honorable M ayor and Cit y Council We have audited the accompanying fi nancial statements of the governmental activities, the businesstype acti vities, each major fund, and the aggregate remaining fund in formation of the City of Palmer, Alaska, as of and for the year ended December 31, 2007, which COllecti vely comprise City of Palmer's basic financial statements and have issued our report thereon dated June 6, We conducted our audit in accordance with auditing standards generall y accepted in the United States of America and the standards applicable to financial audits contained in Govemment Auditing Standards, issued by the Comptroller General of the United States. Internal Control Over Financial Reporting In planning and perfonning our audit, we considered City of Palmer's internal control over financial reporting as a basis fo r designing our auditing procedures for the purpose of ex pressing our opinion on the finan cial statements, but not for the purpose of expressing an opinion on the effectiveness of the City's internal control over financial reportin g. Accordingly, we do no express an opinion on the effectiveness of the City's internal control over financial reporting. A control deficiency exists when the design or operation of a control does not allow management or empl oyees, in the nonnal course of performing their assigned functions, to prevent or detect mi sstatements on a timely basis. A significant deficiency is a control deficiency, or combination of control defi ciencies, that adversely affects the en ti ty's abi lit y to initiate, authorize, record, process, or report fi nancial data reliably in accordance wi th generall y accepted accounting principles such that there is more than a remote likeli hood that a mi sstatement of the entity's fin ancial statements that is more than inconsequential will not be preve nted or detected by the entity's internal control. A material weakness is a significant deficiency, or combination of significant deficiencies, that results in more than a remote li kel ih ood that a material misstatement of the financial statements will not be prevented or detected by the entity's internal control. Our consideration of internal control over fin ancial reporting was for the limited purpose described in the fi rst paragraph of this section and would not necessarily identify all deficiencies in intern al control that might be significant deficiencies or material weaknesses. We did not identify any deficiencies in intern al contro l over financial reporting that we consider to be material weaknesses, as defined above I "C-' Street. Suite 600 Anchorage. Alaska (907) Fax (907)

10 Honorable Mayor and City Counc il Compliance and Other Matters As part of obtaining reasonable assurance about whether City of Palmer' s financial statements are free of material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts and grant agreements, noncompliance with whi ch could have a direct and material effect on the determination of fi nancial statement amounts. However, providing an opinion on compliance with those provisions was not an objective of our audit and, accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance or other matters that are required to be reported under Govemmelll Auditing Stalldards. This report is intended solely for the information and use of City of Palmer's management, Honorable Mayor and City Counci l, and appropriate State agencies, and is not intended to be and should not be used by anyone other than these specified parties. Anchorage, Alaska June 6,

11 ~ Mikunda, Cottrell & Co., inc. CCflificd Public Accountaills & Consultants RSM McGladrey Network An ~depelloei~o-d IoIerrbef Offices In Anchorage & Kenai Independent Auditor's Report on Compli ance with Requirements Applicable to Each Major Program and on Internal Control Over Compliance in Accordance with the State of Alaska Audit Guide and Compliallce Supplement (or Slale Sillgie Audits Honorable Mayor and City Council Compliance We have audited the compliance of the City of Palmer wi th the types of compliance requirements described in the State of Alaska Audit Guide and CompLiance Supplemem for State SingLe Audils that are applicable to each of its major slate programs for the year ended December 31, City of Palmer's major state programs are identified in the accompanying Schedule of State Financial Assistance. Compliance with the requirements of laws, regul ations, contracts and grants applicable to each of its major state programs is the responsibility of City of Palmer's management. Our responsibility is to express an opinion on Ci ty of Palmer's compliance based on our audit. We conducted our audit of compliance in accordance with auditing standards generall y accepted in the United States of America; the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States; and Stare of Alaska Audit Guide and Compliance Supplement for Stale Single Audits. Those standards and State of Alaska Audit Guide and Compliance Supplement for State Single Audits require that we plan and perform the audit to obtain reasonable assurance about whether noncompliance with the types of compliance requirements referred to above that could have a direct and material effect on a major state program occurred. An audit incl udes examining, on a test basis, evidence about City of Palmer's compliance with those requirements and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion. Our audit does not provide a legal determination of City of Palmer's compliance with those requirements. In our opinion, City of Palmer complied, in all material respects, with the requirements referred to above that are applicable to each of its major state programs for the year ended December 31, "C" Street, Suite 600 ' Anchorage, Alaska ' (907) ' Fax (907) '

12 Honorable Mayor and City Council Internal Control Over Compliance The management of City of Palmer is responsible for establishing and maintaining effective interna1 control over compliance with the requirements of laws, regulations, contracts and grants applicable to state programs. In planning and petfonning our audit, we considered City of Palmer's internal control over compliance with requirements that could have a direct and material effect on a major state program in order to determine our auditing procedures for the purpose of expressing our opinion on compliance but, not for the purpose of expressing an opinion on the effectiveness of internal control over compliance. Accordingly, we do not express an opinion on the effectiveness of City of Palmer's internal control over compliance. A colllrol deficiency in an entity's internal control over compliance exists when the design or operation of a control does not allow management or employees. in the normal course of petforming their assigned functions, to prevent or detect noncompliance with a type of compliance requirement of a state program on a timely basis. A signijicarzt deficiency is a control deficiency, or combination of control deficiencies, that adversely affects the entity's ability to administer a state program such that there is more than a remote likelihood that noncompliance wi th a type of compliance requirement of a state program that is more than inconsequential will not be prevented or detected by the entity's internal control. A material weakness is a significant deficiency, or combination of significant deficiencies, that results in more than a remote likelihood that material noncompliance with a type of compliance requirement of a state program will not be prevented or detected by the entity's internal control. Our consideration of internal control over compliance was for the limited purpose described in the first paragraph of this section and would not necessari ly identify all deficiencies in internal control that might be significant deficiencies or material weaknesses. We did not identify any deficiencies in internal control over compliance that we consider to be materi al weaknesses, as defined above. This report is intended solely for the infonnation and use of management, Honorable Mayor and City Council, and appropriate state awarding agencies, and is not intended to be and should not be used by anyone other than these specified parties. Anchorage, Alaska June 6,