HomeMy Public PortalAbout20090707AuditMinutes.pdf
City of Tybee Island
Audit Committee Meeting
Tuesday, July 7, 2009
8:00 a.m.
Room 7 – Old School
APPROVED MINUTES
Member Attendance: Bill Blakey, Alfie Waite, Sallie McClelland, Steven Bryan, Gavin
Murphy
Council Liason: Dick Smith
Staff: Bonnie Kline
Bill Blakey, chair, called the meeting to order 8:03 a.m.
There was a motion by Sallie, seconded by Steve, to approve the minutes from the March
18 meeting. All approved the minutes as written.
REVIEW OF THE AUDITOR’S FINANCIAL REPORT FOR THE SIX MONTH
PERIOD ENDED JUNE 30, 2008
Bill noted there were several typographical errors in the report, particularly inaccurate
dates. Bonnie noted the errors.
Bill asked about the overall profit or loss status of the city reflected in the financials
indicating that the city had experienced a decline in net assets during the period covered.
Bonnie noted that there were only six months of figures in the report given that the city
had switched from a December end of fiscal year to a June end. Therefore the numbers
did not completely reflect seasonal cash flows. She said the report for the fiscal year
ended June 30, 2009 would present a more complete picture.
There was a discussion about the accounting for beach re-nourishment costs.
Steve inquired about the accounting of revenue and expenses related to the city-owned
campground. This was followed by a discussion about debt service for the bonds issued
by Chatham County to finance acquisition of the campground. Bonnie explained
scheduled debt service payments. Steve asked if there were any studies on the
campground’s financial impact on local businesses. Alfie noted that the overall return on
the campground for the city would be positive if it were not for the debt structure. Dick
noted that costs associated with the campground and its impact on the city’s finances
would continue to be a political issue.
Gavin asked about notes in the financial report indicating that the city was not in
compliance with debt service covenants related to its water and sewer debt. Bonnie said
recent rate increases had resolved the situation.
Bill asked about the status of the water and sewer and solid waste collection accounts
showing expenses in excess of revenues. Bonnie said increased water rates would be
reflected in future figures. Bonnie said the city had retained a new service provider that
should lower costs for waste collection for the city. There was discussion about the city
dump being accounted for under the sanitation account and Dick said the city is
considering shifting the account to public works.
Bill asked about the city’s cash position. Bonnie explained the city has cash in various
accounts. Gavin noted that the report showed the general fund’s unreserved and
undesignated cash balance showed an increase during fiscal 2008. Dick noted that the
public sometimes has the mistaken notion that the city has no cash reserves. Bill asked
about the collateralization for city accounts and Bonnie said they were all collateralized.
STATUS OF THE CITY’S PENSION PLAN
Bill asked about the financial status of the pension plan. Bonnie explained that city is
accounting for its required contributions to the state managed pension fund as required
for its employees. She noted that accounting for pension costs in future reports would
offer more details. Dick noted that there is confusion among the public about the amount
the city will have to pay to help meet its unfunded liability and the amounts suggested
often are exaggerated.
AUDIT REPORT’S NOTES ON INTERNAL FINANCIAL CONTROLS
Bill asked about the city management’s response to the report’s findings related to the
city’s internal controls and accounting and if the problems addressed were being
resolved. Bonnie noted that there were still some adjustments from prior years that
needed to be made. She said she had made 75% percent of the suggested adjustments
herself.
Gavin asked about staffing in Bonnie’s department. Bonnie explained the structure of the
staffing.
PRESENTATION OF THE AUDIT REPORT TO CITY COUNCIL
Dick said he wanted Bill and Bonnie to present the audit report to the city council. Bill
said he would work on a presentation. Dick said he would schedule the presentation for
the second council meeting in July.
Steve made a motion to adjourn. Gavin Seconded. All agreed.
Gavin Murphy
Secretary