TGM Audit Report Gor Dochester County

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How does this stack up to trice’s audit presentation for salisbury?

Audit Presentation

Tom Trice, Certified Public Accountant for Trice, Geary & Myers, introduced Roy Geiser, Accountant, and presented the Council with an overview of the audit for the year that ended on June 30, 2007. Mr. Trice stated that the County’s assets exceeded its liabilities by $51.7 million of which $13.2 million may be used to meet the County’s ongoing obligations to citizens and creditors. He explained that the County’s overall financial position had improved since the prior fiscal year with total net assets increasing by $3.1 million or 6.4% and that the contributing factors for this increase were a $2.5 million increase in investment in capital assets, net of related debt and a $0.7 million increase in restricted net assets. Mr. Trice stated that as of the close of FY07, the County’s governmental funds reported combined ending fund balances were $15.1 million, a decrease of $1.0 million from the prior year’s ending fund balance and that out of the total ending fund balances, $10.9 million was unreserved and therefore available for spending at the County’s discretion. He explained that the unreserved fund balance for the General Fund was $4.3 million and that the County’s long term debt decreased by $2.6 million during FY07 due to the County having no major debt issuances during the fiscal year and the treatment of $2.5 million in general obligation bonds.

Mr. Trice expressed his belief that more personnel were needed for the Finance Department based on an increased workload and the risk based auditing requirements that were recently implemented.

In response to a question from Councilman Nichols as to the status of the County’s debt service, Mr. Spears noted that the debt service had decreased from FY06.

Councilwoman Elzey questioned what would happen if new procedures were not implemented to take into account the new risk based auditing requirements. Mr. Spears stated that he anticipated that the procedures would be in place before the new audit commences.

Based on a question from Councilwoman Elzey as to whether or not there was reduction in yearend journal entries, Mr. Spears noted that those entries were drastically reduced to 13 for FY07 and would be reduced even further for FY08.

In response to a question from Councilman Newcomb as to how the County rated on a scale of one to ten, Mr. Trice noted that the County’s financial results were satisfactory but that there were still some administrative challenges County staff faced in grants accounting and administration.

Based on a question from Wendell Foxwell, a resident of Dorchester County, as to whether or not the County has set aside reserve funds, Mr. Spears explained that the County sets aside 5% of the General Fund Operating Budget each year and that any fund balance remaining at the end of each year is set aside and used for capital expenditures in subsequent years. He noted that the fund balance at the end of 2007 was $1.8 million and that those funds would be used in FY09 for capital projects to reduce the issuance of debt for capital needs.

The Council thanked Mr. Trice for his presentation.

The Council discussed an Audit Engagement Letter with Trice, Geary, Myers for professional auditing services for one year at a cost not to exceed $70,000 including providing assistance to the County with documentation of risk base auditing at the cost of $15,000 and agreed to execute the letter. The Council acknowledged that the fee for the auditing services will be at the standard hourly rates plus out-of-pocket costs, including report reproduction, typing, postage, travel, copies, telephone and that if the audit time schedule could not be adhered to by the County, the County would have the following options: 1) that services would not be provided during the period of December 1, 2008 through April 15, 2009 and the fee for the services will remain at a cost not to exceed $70,000 or 2) Trice Geary and Myers will continue to work during the period of December 1, 2008 through April 15, 2009 but will bill at standard hourly rates and would not be subject to requirement that the fee will not exceed $70,000. The Council further acknowledged that if audit is not completed by December 1, 2008, a new agreement will be presented for the Council’s review and consideration.