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<br />Sample Government, FLORIDA <br /> <br />SCHEDULE OF FINDINGS AND QUESTIONED COSTS-FEDERAL A WARDS AND <br />STATE FINANCIAL ASSISTANCE PROJECTS <br />(Continued) <br /> <br />SECTION II - FINANCIAL STATEMENT FINDINGS (Continued) <br /> <br />Effect <br /> <br />The potential effect was, that without the above noted corrections, the City's financial statements could <br />have been materially misstated. <br /> <br />Cause <br /> <br />The Financial Services Department believed that these transactions were properly recorded. <br /> <br />Recommendation <br /> <br />The City should implement procedures to ensure that, at the end of the fiscal year, all receivables and <br />related revenues, and all liabilities and related expenditures/expenses are properly recorded, <br /> <br />Views of Responsible Officials and Planned Corrective Action <br /> <br />The Financial Services Department believed that all transactions had been properly recorded in prior <br />fiscal years with the issuance of the City's prior audited financial statements. Based upon detailed <br />research and discussion, the City ultimately recorded the prior period adjustments for inclusion into the <br />financial records to accurately reflect the City's financial position. The City, as part of its year end <br />process, has implemented procedures to ensure that the appropriate transactions relating to all receivables <br />and related revenues, and all liabilities and related expenditures/expenses are property recorded. <br /> <br />Other Matters <br /> <br />2007-02 Contributions from Outside Parties <br /> <br />Criteria <br /> <br />Contributions received by the City from outside parties to partially fund capital projects should be <br />recorded as revenues. Applicable costs incurred should be recorded as expenditures. <br /> <br />Condition <br /> <br />The City recorded an amount received from a developer to fund a portion of a City capital project as an <br />escrow deposit, rather than as a revenue. Disbursements made for project costs were charged to the <br />escrow deposit account, rather than being recorded as an expenditure. Capital asset additions are captured <br />based on the review of items charged to the 6000 expenditure code. Since these costs did not flow though <br />the expenditures, the capital asset related to this project was not recorded. This transaction resulted in an <br />adjustment to record the expenditure and revenue of $3.4 million in the Five Year Capital Improvement <br />Fund, and adjustment to the governmental activities capital assets for the same amount. <br /> <br />I <br /> <br />2 <br />