5.1. ERMUSR 04-14-2009 - Laserfiche WebLink

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ABDO EICK & ®~'•~'_lMEYER~LLP Certtfied Public Accountants & Consultants 5201 Eden Avenue Suite 370 Edina, MN 55436 REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING BASED ON AN AUDIT OF FINANCIAL STATEMENTS Public Utilities Commission Elk River Municipal Utilities Elk River, Minnesota In planning and performing our audit, we considered Elk River Municipal Utilities (the Utilities) of the City of Elk River, Minnesota, (the City) internal control over financial reporting (internal control) as a basis of designing our auditing procedures for the purpose of expressing our opinion on the fmancial statements, but not for the purpose of expressing an opinion on the effectiveness of the Utilities' internal control over financial reporting. Accordingly, we do not express an opinion on the effectiveness of the Utilities' internal control over financial reporting. Our consideration of internal control over financial reporting was for the limited purpose described in the preceding paragraph and would not necessarily identify all deficiencies in internal control over fmancial reporting that might be significant deficiencies or material weaknesses. However, as discussed below, we identified certain deficiencies in internal control over fmancial reporting that we consider to be significant deficiencies. A control deficiency exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent or detect misstatements on a timely basis. A significant deficiency is a control deficiency, or combination of control deficiencies, that adversely affects the Utilities' ability to initiate, authorize, record, process, or report fmancial data reliably in accordance with generally accepted accounting principles such that there is more than a remote likelihood that a misstatement of the Utilities' fmancial statements that is more than inconsequential will not be prevented or detected by the Utilities' internal control. We consider fmding 2008-1 to be a significant deficiency in internal control over fmancial reporting. A material weakness is a significant deficiency, or combination of significant deficiencies, that result in more than a remote likelihood that a material misstatement of the financial statements will not be prevented or detected by the Utilities' internal control. We consider fording 2008-1 to be a material weakness. The Utilities' response to the fmdings identified in our audit is described in the accompanying Schedule of Findings and Responses. We did not audit the Utilities' responses and, accordingly, we express no opinion on them. This report is intended for solely the information and use of the Commission, management, City Council and the Minnesota Office of the State Auditor and is not intended to be and should not be used by anyone other than these specified parties. Apri19, 2009 Minneapolis, Minnesota -40- J ABDO, EICK & MEYERS, LLP Certified Public Accountants 952.835.9090 Fax 952.835.3261 www.aemcpas.com