HomeMy WebLinkAboutRepresentation Letter December 31, 2006 CITY OF
OAK PARK HEIGHTS
14168 Oak Park Boulevard No. • P.O. Box 2007 • Oak Park Heights, MN 55082 -2007 • Phone: 651/439 -4439 • Fax: 651/439 -0574
HLB Tautges Redpath, Ltd.
4810 White Bear Parkway
White Bear Lake, Minnesota 55110
We are providing this letter in connection with your audit of the financial statements of the City
of Oak Park Heights, Minnesota as of December 31, 2006 and for the year then ended for the
purpose of expressing an opinion as to whether the financial statements present fairly, in all
material respects, the respective financial position of the governmental activities, the business -
type activities, each major fund, and the aggregate remaining fund information of the City of Oak
Park Heights, Minnesota and the respective changes in financial position and, where applicable,
cash flows thereof in conformity with U.S. generally accepted accounting principles. We
confirm that we are responsible for the fair presentation of the previously mentioned financial
statements in conformity with U.S. generally accepted accounting principles. We are also
responsible for adopting sound accounting policies, establishing and maintaining effective
internal control, and preventing and detecting fraud.
We confirm, to the best of our knowledge and belief, as of the date listed below the following
representations made to you during your audit.
1. The financial statements referred to above are fairly presented in conformity with U.S.
generally accepted accounting principles and include all properly classified funds and
other financial information of the primary government and all component units required
by generally accepted accounting principles to be included in the financial reporting
entity.
2. We have made available to you all:
a) Financial records and related data and all audit or relevant monitoring reports, if
any, received from funding sources.
b) Minutes of all meetings of the City Council or summaries of actions of recent
meetings for which minutes have not yet been prepared.
3. There have been no communications from regulatory agencies concerning
noncompliance with, or deficiencies in, financial reporting practices.
4. There are no material transactions that have not been properly recorded in the
accounting records underlying the financial statements.
Tree City U.S.A.
HLB Tautges Redpath, Ltd.
Representation Letter, Page 2
5. We believe the effects of the uncorrected financial statement misstatements
summarized in the attached schedule are immaterial, both individually and in the
aggregate, to the financial statements taken as a whole. In addition, you have
recommended adjusting journal entries that have been posted in the City of Oak Park
Heights' accounts. We are in agreement with these adjustments.
6. We acknowledge our responsibility for the design and implementation of programs and
controls to prevent and detect fraud.
7. We have no knowledge of any fraud or suspected fraud affecting the entity involving:
a) Management;
b) Employees who have significant roles in internal control, or
c) Others where the fraud could have a material effect on the financial statements.
8. We have no knowledge of any allegations of fraud or suspected fraud affecting the
entity received in communications from employees, former employees, analysts,
regulators, or others.
9. We have a process to track the status of audit findings and recommendations.
10. We have identified to you any previous financial audits, attestation engagements,
performance audits, or other studies related to the objectives of the audit being
undertaken and the corrective actions taken to address significant findings and
recommendations.
11. We have provided our views on reported findings, conclusions, and recommendations,
as well as our planned corrective actions, for the report.
12. The City of Oak Park Heights, Minnesota has no plans or intentions that may materially
affect the carrying value or classification of assets, liabilities or fund equity.
13. The following, if any, have been properly recorded or disclosed in the financial
statements:
a) Related party transactions, including revenues, expenditures /expenses, loans,
transfers, leasing arrangements and guarantees, and amounts receivable from or
payable to related parties.
b) Guarantees whether written or oral, under which the City of Oak Park Heights,
Minnesota is contingently liable.
c) All accounting estimates that could be material to the financial statements,
including the key factors and significant assumptions underlying those estimates
HLB Tautges Redpath, Ltd.
Representation Letter, Page 3
and measurements. We believe the estimates and measurements are reasonable in
the circumstances, consistently applied, and adequately disclosed.
14. We are responsible for compliance with the laws, regulations, and provisions of
contracts and agreements applicable to us, including tax or debt limits and debt
contracts; and we have identified and disclosed to you all laws, regulations and
provisions of contracts and agreements that we believe have a direct and material effect
on the determination of the financial statement amounts, including legal and contractual
provisions for reporting specific activities in separate funds.
15. There are no:
a) Violations or possible violations of budget ordinances, laws and regulations
(including those pertaining to adopting, approving, and amending budgets),
provisions of contracts and grant agreements, tax or debt limits, and any related debt
covenants whose effects should be considered for disclosure in the financial
statements, or as a basis for recording a loss contingency, or for reporting
noncompliance.
b) Unasserted claims or assessments that our lawyer has advised us are probable of
assertion and must be disclosed in accordance with Financial Accounting Standards
Board (FASB) Statement No. 5, Accounting for Contingencies.
c) Other liabilities or gain or loss contingencies that are required to be accrued or
disclosed by FASB Statement No. 5.
d) Reservations or designation of fund equity that were not properly authorized and
approved.
16. The City of Oak Park Heights, Minnesota has satisfactory title to all owned assets, and
there are no liens or encumbrances on such assets nor has any asset been pledged as
collateral.
17. The City of Oak Park Heights, Minnesota has complied with all aspects of contractual
agreements that would have a material effect on the financial statements in the event of
noncompliance.
18. The financial statements include all component units as well as joint ventures with an
equity interest, and properly disclose all other joint ventures and other related
organizations.
19. The financial statements properly classify all funds and activities.
HLB Tautges Redpath, Ltd.
Representation Letter, Page 4
20. All funds that meet the quantitative criteria in GASB Statement Nos. 34 and 37 for
presentation as major are identified and presented as such and all other funds that are
presented as major are particularly important to financial statement users.
21. Net asset components (invested in capital assets, net of related debt; restricted; and
unrestricted) and fund balance reserves and designations are properly classified and, if
applicable, approved.
22. Provisions for uncollectible receivables have been properly identified and recorded.
23. Expenses have been appropriately classified in or allocated to functions and programs
in the statement of activities, and allocations have been made on a reasonable basis.
24. Revenues are appropriately classified in the statement of activities within program
revenues, general revenues, contributions to term or permanent endowments, or
contributions to permanent fund principal.
25. Interfund, internal, and intra- entity activity and balances have been appropriately
classified and reported.
26. Special and extraordinary items, if any, are appropriately classified and reported.
27. Deposits and investment securities are properly classified as to risk, and investments are
properly valued.
28. Capital assets, including infrastructure assets, are properly capitalized, reported, and, if
applicable, depreciated.
29. Required supplementary information (RSI) is measured and presented within prescribed
guidelines.
30. As part of your audit, you prepared the draft financial statement and related notes. We
have designated a competent management -level individual to oversee your services and
have made all management decisions and performed all management functions. We
have reviewed, approved, and accepted responsibility for those financial statements and
related notes.
HLB Tautges Redpath, Ltd.
Representation Letter, Page 5
To the best of our knowledge and belief, no events, including instances of noncompliance, have
occurred subsequent to the balance sheet date and through the date of this letter that would
require adjustment to or disclosure in the aforementioned financial statements.
Date:
f �
Signed:�1�'
Title: Admiryistrator
Signed:
Title: Deputy Clerk /Finance Director
AUDIT DIFFERENCE EVALUATION FORM
PURPOSE: To summarize known and projected audit differences.
Governmental Unit: City of Oak Park Heights Balance Sheet Date 12/31/2007
Opinion Unit: Water Utility Fund
The following table lists audit differences exceeding:
Financial Statement Effect -
Amount o* Over (Under) Statement of:
Description (Nature) Known (K) or W/P Total Total Net
of Audit Difference Likely (L) Ref. Assets Liabilities Assets Revenues Expenditures
Prepaid insurance is understated K 4450.03 (6,823) (79) 79
Total unadjusted audit differences - current year 6,823 - 79 - 79
Effect of Unadjusted Audit Differences - Prior Year
Net Audit Differences (6,823) - (79) - 79
AUDIT DIFFERENCE EVALUATION FORM
PURPOSE: To summarize known and projected audit differences.
Governmental Unit: City of Oak Park Heights Balance Sheet Date 12/31/2007
Opinion Unit: Sewer Utility Fund
The following table lists audit differences exceeding:
Financial Statement Effect -
Amount of Over (Under) Statement of:
Description (Nature) Known (K) or W/P Total Total Net
of Audit Difference Likely (L) Ref. Assets Liabilities Assets Revenues Expenditures
Prepaid insurance is understated K 4450.03 (4,772) (55) 55
Total unadjusted audit differences - current year (4,772) - + (55)1 - 55
Effect of Unadjusted Audit Differences - Prior Year
Net Audit Differences (4,772) - (55) - 55