By Rebecca Dopp
Times-News Correspondent
Levan Town is in good financial standing and received a "thumbs-up" from Greg Ogden, CPA.
"There were a couple of problems I noted during the audit that you need to address," Ogden said.
The first finding was a state compliance issue. In the public safety department for 2010, the town exceeded the budget. State law requires that towns must stay within the budget that was approved.
"You need to watch that closely towards the end of June," he said. "I know it's hard to outguess which invoices are going to be coming in after the year ends that have to be accrued as payables."
He suggested the council budget a little high and have a cushion for each of the departments.
The second finding was in regard to internal controls. During the year, cash accounts that were in CDs were moved to a different bank, and the activity of moving those accounts and recording the interest was not recorded.
"It's very important that every cash account is reconciled each month," Ogden said.
He said he thought the findings were minor and could easily be taken care of. The town's staff has already responded to the findings.
When it comes to the financials, the town's responsibility is to make sure the financial statements are accurate. The auditor's job is to audit them and express an opinion.
A few years ago, the Governmental Accounting Standards Board changed the way accountants do governmental accounting. Up until then, there was fund accounting, meaning there were separate funds for each department (general, gas, water, etc.) and all the business-type accounts, which charge a fee sufficient to cover the services.
The governmental funds used to not include fixed assets, capital assets, and long-term debt. They went to current resources basis (what cash do you have on hand and how are you going to spend it?)
The new schedules adjust all the accounts similar to what a business would do.
The town has $239,000 in governmental unrestricted net assets and $298,000 in business-type unrestricted net assets.
"That's cash that we actually have?" asked Brady Taylor, council member.
"That's what you have available to use for any purpose" said Ogden, "but don't spend it. You need some operating capital."
He pointed out that within the business-type activities, the town needs to charge enough in service fees to cover the cost of providing the service. With exception to the cable department, the business-type activities were able to charge sufficient fees.
"I wouldn't worry too much about the cable, they were $1,300 under," Ogden said. "but overall your net operating income is $113, 531."
He said the audit was easy to do with the help of Carol Mattinson, town treasurer, and Heather Taylor, town clerk. He also appreciated the help that Pelorus gives the town in preparing the reports.
