Eldora

Schedule of Findings Year ended June 30,2024 Response- The city clerk is currently reconciling the bank and another employee is entering accounts payable. The finance committee is now reviewing and signing off on the bank reconciliations. We will also continue to provide the council with copies of financial reports. This helps mitigate the lack of segregation noted above Conclusion- Response accepted. 2024-002 Preparation of Financial Statements Criteria - Management is responsible for establishing and maintaining internal controls over financial reporting and procedures related to the fair presentation of the financial statements in accordance with U.S. generally accepted accounting principles (GAAP). Condition - The City does not have an internal control system designed to provide the preparation of the financial statements, including the accompanying footnotes, as required by generally accepted accounting principles. Cause - The staff has not obtained the expertise necessary to prepare the financial statements, including the accompanying footnotes. Effect - The audit firm was requested to draft the financial statements and accompanying notes to the financial statements, which is not unusual in an organization of your size. Recommendation- We realize that obtaining the expertise necessary to prepare the fmancial statements, including all necessary disclosures, in accordance with generally accepted accounting principles can be considered costly and ineffective. However, it is the responsibility of the City's management and those charged with governance to make the decision whether to accept the degree of risk associated with this condition because of cost or other considerations. Response -Management feels that committing the resources necessary to remain current on GASB reporting requirements and corresponding footnote disclosures would lack benefit in relation to the cost but will continue evaluating on a going forward basis. Conclusion- Response accepted. 59 ### Page 66 City of Eldora, Iowa Schedule of FindingsYear ended June 30, 2024Part II: Other Findings Related to Statutory Reporting:2024-A Certified Budget- Disbursements during the year ended June 30, 2024 exceeded the amounts budgeted in the health and social services and community and economic development functions. Chapter 384.20 of the Code oflowa states, in part, "Publicmonies may not be expended or encumbered except under an annual or continuing appropriation." Recommendation - The budget was amended, but should be amended in sufficient amounts and review the proper function category before the disbursements exceed the budget. Response - The budget will be amended in sufficient amounts and in the proper function category in the future, if applicable. Conclusion - Response accepted. 2024-B Questionable Disbursements - No disbursements were noted that may not meet the requirements of public purpose as defined in an Attorney General's opinion dated April25, 1979. 2024-C Travel Expense- No disbursements of City money for travel expenses of spouses of City officials or employees were noted. 2024-D Business Transactions - Business transactions between the City and City officials are detailed as follows: Name, Title and Transaction Business Connection Description Amount Aaron Budweg- AdministratorOwner of Buds Laundromat TIF Rebate60 ### Page 67 City of Eldora, Iowa Schedule of Findings Year ended June 30, 2024Per Chapter 362.5 of the Code of Iowa, this transaction does not appear to be a conflict of interest as it was less than $6,000 during the fiscal year. It was also noted that the council approved the TIF rebate agreement in a prior fiscal year.2024-E Restricted Donor Activity - No transactions were noted between the City, City officials, City employees and restricted donors in compliance with Chapter 68B of the Code ofiowa.2024-F Bond Coverage - Surety bond coverage of City officials and employees is in accordance with statutory provisions. The amount of coverage is reviewed annually to ensure that coverage is adequate for current operations.2024-G Council Minutes - No transactions were found that we believe should have been approved in the City Council minutes but were not. However, the publications did not always include the summary of receipts, summary of disbursements by fund and list of claims and purpose as required by the Code ofiowa.Recommendation- The City should comply with the Code ofiowa and publish the minutes as required. Response- There was some turnover in the clerk's office and the information was not always published as required. We have corrected this now and all the items required should be included as required in the future. Conclusion - Response accepted.2024-H Deposits and Investments - No instances of non-compliance with the deposit and investment provisions of Chapters 12B and 12C of the Code ofiowa and the City's investment policy were noted.2024-l Revenue Bonds and Notes- No instances of non-compliance with the revenue bond and note resolutions were noted.2024-J Urban Renewal Report- The Annual Urban Renewal Report was properly certified to the Iowa Department ofManagement on or before December I and no exceptions were noted. 61 ### Page 68 City of Eldora, Iowa Schedule of Findings Year ended June 30,2024 2025-J Financial Condition - The Special Revenue Funds, Trust and Agency account had a deficit balance of$70,566 the Grant Fund had a deficit balance of$2914, and the General Fund had a deficit balance of$411 ,176 at June 30, 2024. Recommendation - The City should investigate alternatives to eliminate these deficits. Response- See note 14 to the financial statements to see how City officials plan to eliminate these deficits. Conclusion- Response accepted. 62