BKR Garcia & Co. - Laserfiche WebLink

Home Browse Search

I APPENDIX III - MANAGEMENT LETTERS DEVELOPED AND ISSUED IN CONNECTION WITH LOCAL GOVERNMENT AUDITS I I I I I I I I I I I I I I I I I I TOWN OF SOUTHWEST RANCHES, FLORIDA SCHEDULE OF FINDINGS AND RECOMMENDATIONS SEPTEMBER 30, 2005 (CONTINUED) SECTION 11- STATUS OF PRIOR YEAR FINDINGS AND RECOMMENDATIONS (CONTINUED) 2004-3: Invoice date per accounting system is different than actual invoice date (Continued) Status: The Town corrected the problem as soon as the problem was discovered by the auditors. However, since this problem was still present for most of the year 2005, this comment will be repeated. Management's Response: The new financial system implemented in October 2005 will prevent this system design flaw from happening again. 2004-4: Individual funds not in balance Condition: The individual fund balance of the different funds of the Town in the trial balance provided to the auditors at the beginning of the audit was not in balance. In addition, the fund balance did not agree to the audited financial statements for the year ended September 30, 2003. Recommendation: We recommend that the person in charge of recording transactions review the propriety of the transaction and adjust the due to/from accounts for transactions affecting more than one fund. We also recommend that upon receipt of the list of audit adjusting journal entries adjustments be recorded in the Town's accounting system. The accounting year should not be closed unless account balances and fund balance/deficit per the accounting system agree to amounts per the financial statements. Furthermore, once the accounting year is closed, fund balances per the accounting system should be compared to fund balances per the financial statements. Status: The trial balance provided to the auditors for the September 30, 2005 audit did not reflect the proper beginning balance (September 30, 2004 audit balance) for two of the funds included in the trial balance. This comment shall be repeated. Management's Response: Management agrees with the recommendation that all adjusting entries should be posted and that the individual funds should be in balance. We will review the fund balances on a regular basis. 15