Michigan Department of Treasury Community Engagement and Outreach Division

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1 Michigan Department of Treasury Community Engagement and Outreach Division Presented by: Daniel C. Horn Harlan Goodrich Cary Jay Vaughn 1

2 Public Act 202: Preliminary 2018 Timeline for Initial Annual Reports (Fiscal Year Ending: January through June of 2017) If applicable, Treasury issues preliminary underfunded status letter and waiver guidance to local units of government. Municipal Stability Board meets to issue corrective action plan requests (subject to final approval and commencement). Overall review of the process and continued oversight. January February April May November December Treasury sent reporting form (5572) and instructions to local units of government. Electronic submission of reporting form (5572) due from local units of government with a fiscal year ending January through June of If applicable, local units of government submit a waiver application with a resolution from the local unit s governing body to Treasury. Municipal Stability Board meets to approve or deny corrective action plan requests (subject to final approval and commencement). 2

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4 7 Community Engagement and Outreach Staff Municipal Finance Harlan Goodrich Data Solutions - Carol Goslin Audit - Cary Jay Vaughn Analytics & Outreach - Dan Horn Outreach, School Review & Fiscal Analysis Mike Wrobel 8 State Statutes Auditor should be familiar with: PA 2 of Uniform Budgeting and Accounting Act PA 71 of Uniform System of Accounting PA 140 of Revenue Sharing Act PA 34 of Revised Municipal Finance Act 4

5 Forms and Publications Auditing Procedures Report Annual Local Unit Fiscal Report (F65) Uniform Chart of Accounts Budget Manual Audit Manual Uniform Reporting Format Numbered Letters 10 Auditing Procedures Report (APR) 5

6 12 Audit Extension Numbered letter Must be requested before audit report statutory due date Each request considered individually Only granted for extraordinary cause Must be beyond the control of the Local Unit 6

7 13 F65 Extension Revisions to the F65 Report 7

8 Audit Reviews by Treasury 16 Enhanced/Additional Reporting For local units of government Interim to the financial statements 8

9 17 FRAUD REPORT - Possible or Actual Oral report to Bureau of Local Government Services, Local Government Financial Services Division Follow up with written report (if one exists) to: Local Government Financial Services, P.O. Box 30728, Lansing, Michigan Uniform Chart of Accounts 9

10 Public Act 2 of 1968 (PA 2), as amended The state treasurer shall prescribe uniform charts of accounts for all local units of similar size, function, or service designed to fulfill the requirements of good accounting practices relating to general government. The official who by law or charter is charged with the responsibility for the financial affairs of the local unit shall insure that the local unit accounts are maintained and kept in accordance with the chart of accounts. The state treasurer may provide assistance, advice, or instruction to a local unit to establish or maintain the uniform chart of accounts 20 Public Act 2 of 1968 Michigan Department of Treasury (Department) is responsible for regulating and monitoring the submission of all audited financial statements for all units of local government in Michigan. 10

11 21 MCL Every audit report shall do all of the following: (a) State that the audit has been conducted in accordance with the standards prescribed by the state treasurer. (b) State that financial statements in such reports have been prepared in accordance with applicable rules and regulations of any state department or agency. Any deviations from such principles, rules, or regulations shall be described. (c) disclose any material deviations by the local unit from applicable rules and regulations of any state department or agency. (d) disclose all fiscal irregularities, defalcations, misfeasance, nonfeasance or malfeasance which came to the auditor's attention."

12 23 Stay Connected Local Government Accounting and Auditing Issues Michigan Units of Local Government 12