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City of San Leandro <br />Meeting Date: July 1, 2013 <br />Staff Report <br />Agenda Section:File Number:13-340 CONSENT CALENDAR <br />Agenda Number:8.H. <br />TO:City Council <br />FROM:Chris Zapata <br />City Manager <br />BY:David Baum <br />Finance Director <br />FINANCE REVIEW:David Baum <br />Finance Director <br />TITLE:Staff Report on the Independent Auditor’s City of San Leandro Memorandum <br />of Internal Control and Required Communications for the year-ended June 30, <br />2012 <br />SUMMARY AND RECOMMENDATIONS <br />Staff recommends that the City Council accept the City’s Memorandum of Internal Control and <br />Required Communications for the year ended June 30, 2012. <br />BACKGROUND <br />On March 4, 2013, Council accepted the Comprehensive Annual Financial Report (CAFR) for <br />the year ended June 30, 2012. In planning and performing the audit of the financial <br />statements, the City’s independent auditors considered the City’s internal control over <br />financial reporting (internal control) as a basis for designing the auditing procedures for the <br />purpose of expressing opinions on the financial statements. At the completion of the audit, an <br />unqualified, clean opinion was rendered by Maze & Associates. <br />DISCUSSION <br />The City’s independent auditor completed audits of the City’s financial statements , including <br />the Memorandum of Internal Control (MOIC). The audit found no material weaknesses in the <br />internal controls. Maze identified four significant deficiencies. Staff responses are contained <br />in the attached report. The four issues are set forth below. <br />1.Timeliness of the Preparation of the Comprehensive Annual Financial Report (CAFR) - <br />despite delays, all reporting requirements were met for fiscal year 11-12. <br />2.Timely Preparation of Bank Reconciliations - reconciliations were sometimes delayed <br />beyond the 30 day performance measure. <br />3.Shoreline Enterprise Funds Fund Deficit and Advance to the General Fund - the <br />Page 1 City of San Leandro Printed on 6/25/2013