93-218 Resolution No. 93-218
RESOLUTION
ACCEPTING AND PLACING ON FILE THE AUDIT REPORTS FOR THE
YEAR ENDED DECEMBER 31, 1992
BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF ELGIN,
ILLINOIS, that it hereby accepts and places on file the 1992
Audit Report, Management Letter, Report on Compliance,
Internal Control Structure and Schedule of Federal Financial
Assistance, Report on South Grove Special Tax Allocation Tax
Incremental Financial District, and Report on Dundee Tax
Allocation Tax Incremental Financing District.
BE IT FURTHER RESOLVED that James R. Nowicki, Finance
Director, is hereby directed to file the reports with the
Comptroller of the State of Illinois .
s/ George VanDeVoorde
George VanDeVoorde, Mayor
Presented: August 11, 1993
Adopted: August 11, 1993
Omnibus Vote: Yeas 5 Nays 0
Recorded:
Attest:
s/ Dolonna Mecum
Dolonna Mecum, City Clerk
•
111
Agenda Item No.
j`f YY
July 21, 1993
TO: Mayor and City Council
FROM: City Manager
SUBJECT: 1992 Comprehensive Annual Financial Report and
Management Letter
PURPOSE: To present the 1992 Comprehensive Annual Financial
Report (CAFR) and Management letter to the City Council for
review.
BACKGROUND: The City of Elgin is required by State statutes to
have an annual audit completed by an independent Certified
Public Accounting firm. City staff has prepared a CAFR for the
past 33 years receiving the prestigious Certificate of
Excellence in Financial Reporting award from The Government
Finance Officers Association annually from 1977 through 1991.
This years report has also been submitted in the award program.
The Auditors Management letter from McGladrey and Pullen has
also been submitted for your review. The auditors will be
attending the meeting to present the report.
RECOMMENDATION: The staff will respond to any questions the
City Council may have and the CAFR should then be officially
accepted at the next regular council meeting.
Ci nager
McGLADREY&PULLEN
Certified Public Accountants and Consultants
To the Honorable Mayor and
Members of the City Council
City of Elgin, Illinois
During the course of our audit of the City of Elgin, Illinois for the year ended December 31,
1992 we observed the following and offer our comments and suggestions-for your consideration:
Investments
1. Investment Policy
The City currently does not have a written policy related to the buying and
selling of investment securities. We believe a written summary of the City's
investing philosophy and the procedures and related controls to carry out that
philosophy is an important tool for the employees with the responsibility- of
overseeing investments and should be developed. The City Finance Director is
currently in the process of drafting this policy.
2. Safekeeping/Custodial Agreements
Formalized safekeeping and custodial agreements are an important step in
safeguarding the City's investments. We noted that the City did not have a
formalized safekeeping agreement with Continental Bank, National Association
related to certain Police Pension Fund and Firefighters' Pension Fund
investments. These investments were held in safekeeping accounts under the
Fund's name within Continental's Trust Department. However, we believe a
formalized agreement should be obtained as an extra precaution. Management
has responsed that this issue will be addressed in upcoming Board Meetings of
each pension fund.
•► Business Recovery Planning
The City depends heavily on technology and automated systems. The possibilities for
disaster affecting these systems are endless ranging from natural disasters to human
error and destruction. Although most disasters cannot be prevented, organizations can
anticipate them and plan for recovery. The City currently does not have a
comprehensive business recovery plan. Potential benefits of a business recovery plan
include the minimization of economic loss, reduction of disruption of operations,
achievement of an orderly recovery, reduction of legal liability, limitation of potential
exposure, minimization of insurance premiums, reduction of reliance on key personnel,
protection of assets, and minimization of decision making during a disaster occurrence.
We recommend that the City develop, document and test a business recovery plan to
ensure the continuity of operations, services to its citizens and availability of critical
resources in the event of a disaster. There are various methods and products available
to assist you in this process. We would be happy to discuss these with you in more
detail.
Recordkeeping Fixed Asset Deletions
Physical documentation of fixed asset deletions is not always received by the accounting
department. A physical inventory of fixed assets is conducted annually which
minimizes the chance of not properly stating fixed assets for a long period of tune.
However, we suggest that a disposition card, authorized by the department head, be
submitted for each fixed asset deletion to ensure that timely recordkeeping can occur
and that authorized dispositions are occurring.
This letter is solely for the use of the City Council and management. We appreciate your
staff's cooperation and assistance during our audit. If we can be of any assistance or answer any
questions related to this letter or other matters, please do not hesitate to contact us.
Olympia Fields, Illinois
April 16, 1993