HomeMy Public PortalAbout2019 Brewster Management Letter
TOWN OF BREWSTER, MASSACHUSETTS
MANAGEMENT LETTER
JUNE 30, 2019
ROBERT E. BROWN II, CPA
CERTIFIED PUBLIC ACCOUNTANT
25 CEMETERY STREET - P.O. Box 230
Mendon, Massachusetts 01756
Phone: (508) 478-3941 Fax: (508) 478-1779
To the Honorable Select Board
Town of Brewster, Massachusetts
In planning and performing our audit of the basic financial statements of the Town of Brewster,
Massachusetts, as of and for the fiscal year ended June 30, 2019, in accordance with auditing
standards generally accepted in the United States of America, we considered the Town’s internal
control over financial reporting (internal control) as a basis for designing our audit procedures
for the purpose of expressing an opinion on the financial statements, but not for the purpose of
expressing an opinion on the effectiveness of the Town’s internal control. Accordingly, we do
not express an opinion on the effectiveness of the Town’s internal control.
Our consideration of internal control was for the limited purpose described in the preceding
paragraph and was not designed to identify all deficiencies in internal control that might be
significant deficiencies or material weaknesses and therefore, there can be no assurance that all
deficiencies, significant deficiencies, or material weakness have been identified.
This communication is intended solely for the information and use of management, the Select
Board, and the Commonwealth of Massachusetts and is not intended to be and should not be
used by anyone other than the specified parties.
Respectfully,
Certified Public Accountant
March 17, 2020
TOWN OF BREWSTER, MASSACHUSETTS
COMMUNICATION OF INTERNAL CONTROL RELATED MATTERS
JUNE 30, 2019
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RECONCILIATION OF WATER ACCOUNTS RECEIVABLE
Finding
The Finance Department and the Water Department are periodically reconciling activity and
balances. The Water Department is also periodically reconciling the activity and balances within
the department. However, these efforts are not resulting in perfect reconciliations without
preventing variances in the activity and month end balances.
.
Recommendation
The reconciliation of accounts receivable is a very important internal control. The Water
Department’s receivable report balances and activity must be reconciled to the Water Department’s
own reports and the Town Accountant’s general ledger receivable balance on a monthly basis and
in a timely manner. If a variance occurs, the variance must be investigated in a timely manner.
Managements Response
The Finance Team and Water Department staff have dedicated considerable time, effort, and
energy to resolve this issue and have made good progress. Water department administrative staff
are able to reconcile daily activity, manually tracked on a spreadsheet to reports generated from the
water billing software, yet a timing variance exists at each month end. Software support
technicians from the water billing software have not been able to explain or fix this timing issue.
Management are now investigating new utility billing software, with a goal to implement this new
software by 7/1/2021, which will serve to fully rectify this issue.
TOWN OF BREWSTER, MASSACHUSETTS
COMMUNICATION OF INTERNAL CONTROL RELATED MATTERS
JUNE 30, 2019
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RECONCILIATION OF REVENUE AND EXPENSES SUBSIDIARIES – RESOLVED IN FY19
Prior Year Finding – Resolved in FY19
The revenue and expense subsidiaries for the various funds were not reconciled to the general
ledger revenue and expense control balances on a monthly and timely basis. As a result of the
above deficiency, there were variances between the various subsidiary ledgers and the related
general ledger control accounts. At year end, several significant journal entry adjustments were
made to reclassify the variances in the various funds and the general fund. Upon analysis, we have
proposed several adjustments to these year-end journal entries.
We have concluded that this control deficiency represents a significant deficiency in internal
controls.
Prior Year Recommendation – Resolved in FY19
The reconciliation of the revenue and expense subsidiaries to the general ledger control accounts is
a very important internal control. The revenue and expense subsidiaries must be reconciled to the
related revenue and expenditure control balances on a monthly basis and in a timely manner.