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Board of Trustees Meeting November 13, 2007 |
Agenda Item: Old Business
Discussion addressing the three items identified in the Management Letter, Findings and Recommendations, from the fiscal year 2006/2007 audit.
Background:
Teaman, Ramirez & Smith, Inc.,
conducted an independent audit of the District’s 2006/2007 financial
statements. The audit included a management letter that discussed findings and
recommendations that are intended to improve internal controls. The three areas
identified were 1.)
The County Funds finding indicates that the District maintained
Fund 51110, Deferred Compensation Deposits, with a cash balance of $1,210 and
deposits of $53,889 at the County of Riverside with no activity in that account
for the last several years. Staff has since made contact with the County Principle
Accountant regarding this fund. The County states that there has been no
activity since FY 2003. The original documents were faxed to the District by
the County. They showed that the then Finance
Administrator completed forms to “Inactivate” the Fund in 2003.
Resolution 2004-17 authorizes the District to transfer the entire Fund 51110 balance of $1,210.09 to the active General Fund 51115. On October 24, the District requested the County to make the transfer.
New Accounting Standards
Statement
No. 45 of the Governmental Accounting Standards Board (GASB 45), Accounting and
Financial Reporting by Employers for Post Employment Benefits Other Than
Pensions (OPEB), establishes the standards for the measurement, recognition,
and display of OPEB expense/expenditures, and related liabilities (assets) in
the financial reports of state and local governmental employers. The GASB statement recommends government
employers pre-fund the liability associated with these costs. The audit report
states that GASB 45 is effective for the District as of the 2009-10 fiscal
year. The District has already started to address this by hiring an actuary
firm to carry out an actuarial valuation of the District’s OPEB liabilities
ahead of pre-funding.
Purchasing Procedures
During the fieldwork, the auditors found that a purchase, subject to the District’s informal bid procedure, did not have the documentation attached to the purchase order. When this was brought to staff’s attention, a bid documentation form was devised to address this procedure and is now in use for all purchases that are subject to informal bids at the District. The form helps to keeps the procedures consistent as it provides improved documentation, states the item to be purchased, reason for purchase, an area to list the quotes from the different vendors, and an area for the purchaser to state the justification for choosing the final vendor.
Staff Recommendation:
None
Fiscal Impact:
None