02-09-1998 Council Packet - Laserfiche WebLink

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r I Review of Minnehaha Watershed District Financial Statements for 1994,1995 and 1996 Annual Audit: The District was audited by CPA firms for each year reviewed. In 1994 the firm was Larson Allen Weishair & Co. In 1995 and 1996 the firm was Babcock, Langbein and Company. My personal e.xperience has been that I have been more impressed by the quality of reports issued by Larson Allen Weishair & Co, than the latter firm. Independent Auditor's Report: In all three years the District received an unqualified “clean" opinion on their financial statements. In other words it was the auditors’ opinion that the financial statements were fairly presented in all material respects. There were a couple minor errors in the wording for the 1995 and 1996 opinions. Other Auditor Reports: The audits were conducted under Government Auditing Standards, issued by the Comptroller General of the US. These standards require reports on internal control and compliance to be issued. For all three years these reports were issued. These reports indicate that the auditor’s had no issues of noncompliance that were required to be issued and no material reportable conditions. In the 1996 Babcock, Langbein actually erred by stating they noted no reportable conditions. This^actually a violation of auditing standards. (Codification of Statements on Auditing Standards AU § 326.17). What all the above means is that the firms reported no findings or recommendations related to their audits of the District. In some cases CPA firms issue separate management letters directly to mangement. There is.no indication that they have done this, but you may want to ask the District if they have received separate letters. Financial Statements: A few minor presentation errors noted in the 1995 and 1996 financial statements. However, nothing too critical. The one curious item is that the General (Administrative) Fund in 1995 had a $3,000,000 certificate of deposit that it did not have in 1994. The revenues of the General Fund were roly $265,000 so they were not the source of this investment. It came fi-om the Special Revenue Funds, in particular the tax revenues of the Management Planning Fund. The General Fund does have a liability to the Special Revenue Funds, but the interest earned on the project revenues are being used to eliminate the General Fund ’s deficit. I t ■! I I ii^i im IIP I ^‘ «V. iirrir J