Wednesday, February 10, 2010

02/09/2010 Commissioners Meeting

Again I was about ten minutes late for this 9 a.m. meeting. It seems no matter what I do this morning meeting instead of evening  doesn't work for me. When I arrived there were two gentlemen talking to city officials. As I listened I realized they were talking about the City of Paris Financial Statements fiscal year 2009 which started 7/1/2008 ended 6/30/2009. This time frame was only a partial 1st year in office for our present city officials.
The following is a brief summary of the auditors- Ray, Foley, Hensley & Company.PLLC.
The auditor started out with their Findings Related To Financial Statements conditions. They discussed three items of concern to them.

Item 1. Auditors stated Condition was- . Bank reconciliations are not being performed timely or reviewed by the appropriate level of management.
Auditors stated Criteria was- Internal controls should be in place that provide reasonable assurance that bank reconciliations are prepared in a timely manner and reviewed by the appropriate level of management.
Auditors stated Cause was- There are no policies and procedures to require timely preparation and review of bank reconciliations.
Auditors stated Effect was- Errors and irregularities may not be identified on a timely basis.
Auditors recommendation was- Bank reconciliations should be prepared monthly and reviewed by the appropriate level of management.

Item 2 Auditors stated Condition was- The City lacks experience in applying generally accepted accounting principles to transactions recorded throughout the year and aid in selecting appropriate financial statement disclosures.
Auditors stated Criteria was- Appropriate experience should be sought to more effectively apply generally accepted accounting principles to transactions recorded throughout the year and aid in selecting appropriate financial statement disclosures.
Auditors stated Cause was- The City’s growth necessitates additional expertise in this area.
Auditors stated Effect was- This results in a number of year end adjustments to bring records in-line with generally accepted accounting principles. Also additional assistance is required to produce the statements.
Auditors stated Recommendation was- We recommend management consider the feasibility of the addition of a financial officer with the required background or retain additional consultants to aid the city with the necessary help.

The City of Paris stated Response to item 1. & item 2. was- The City is currently considering reallocating and / or adding resources to more effectively monitor and oversee the financial reporting process. This should also serve to strengthen year end closing procedures.

Sounds like to me, there might be a job opening with the city if you have a financial background.

Item 3 Findings and questioned Costs for Federal Awards-Assistance to Firefighters Grant.
Auditors stated Condition was- The city did not file required reports timely for the Assitance to Firefighters Grant.
Auditors stated Criteria was- Internal controls should be put in place to assure timely filing of required reports.
Auditors stated Cause was- No procedures were in place to monitor compliance with reporting requirements.
Auditors stated Effect was- Grantor may delay further funding or request reimbursement.
Auditors stated Recommendation was- We recommend management design control policies and procedures which aid monitoring all aspects of grants with emphasis on compliance and reporting requirements.

The City of Paris stated Response to this was- The city was in a period of transition. During the transition, reporting requirements were not met due to employee turnover. At present, responsibility for monitoring grants has been consolidated under the assistant city manager. Ongoing assessment is being conducted by the office of the City Manager.

The auditors noted to the city officials they should have been called earlier so they could be presenting the audit to them much sooner. The auditor stated “ We should have presented this in Oct-Nov time frame instead of February.” He noted more than half of fiscal year 2010 is already over and that doesn’t give the city enough time.

Commissioner Galbraith agreed they needed a financial system in place to remedy the present problems. He also said, “that it was city officials responsibility to not have repeat offenses year after year, because that meant we aren’t doing our job.”

I want to again thank the mayor. He had an extra copy of the City of Paris Financial Statements audit. He got up and came to where I was setting and gave the copy to me so I could follow along as the auditors explained the financial statements.

Over all the auditors stated that the turn around from fiscal year 2008 was very good. He felt this group of city officials did a good job of fiscal responsibility.

Mayor Thornton asked the auditors could they give city officials an idea how they measured up to other cities that they audited. The mayor asked are we average, below average, or above average?

The auditor replied he would give them a grade point B just a little above the middle of the pack.

I was pleased to hear what the auditors said, it makes me think they must be doing some things right. Now lets hope the present fiscal year of 2010 which ends June 30th will show an even better job of fiscal responsibility by our city officials.

Until next time,

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