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HomeMy WebLinkAbout2008-06-25 CAFR MinutesMINUTES OF THE SPECIAL MEETING THE JUNE 25, 2008, MEETING OF THE BOARD OF TRUSTEES, TRUSTEE'S CONFERENCF, ROOM RICHARD T. FLICKINGER MUNICIPAL CENTER 6101 CAPULINiA AVENUE, MORTON GROVE, ILLINOIS 60053 Pursuant to proper notice in accordance with the Open Meeting Act, The Special Meeting was called to order at 7:00 pm by Mayor Richard Krier. Clerk Fritzshall called the roll. In attendance were: Elected Officials: President Richard Krier, Trustees Georgianne Brunner, Roy Kogstad, She1 Marcus, Rita Minx, Dan Staackmamn, and John Thill Absent: No absences Village Staff: Village Administrator Joseph F. Wade, and Corporation Counsel Teresa Hoffinan Liston, Finance Director Daniela Partipilo, Assistant Finance Director Ryan Horne Also Present: Daniel Berg of Sikich, one member of the press, and approximately 8 members of the community President Krier announced the purpose of fine meeting was to answer any questions the Board may have regarding the initial draft of the Village's Comprehensive Annual Financial Report (CAFR). Mr. Wade gave a brief overview of the report. He noted pursuant to Resolution 04-28 the Village confirmed debt previously owed by the Waukegan Road TIF District Fund to the General Fund. He also reviewed various accounting procedures and draft financial policies including reporting requirements. Mr. Wade noted the Village's finance policy should support its goals, not the other way around. Mr. Berg then provided a detailed presentation of the Village's audit process and explained each step of that process: planning meetings, preliminary field work, final field work, and the exit conference. Mr. Berg then answered questions regarding the delay in submitting the final draft which was in part due to approval of the resolution confirmiiig the Waukegan Road TIF debt to the Village. Mr: Berg then discussed the financial highlights of 2007 audit and explained the transmittal and management letter. He noted the CAFR including all of its documents serves as a historical Village file explaining where the Village stood financially as of a particular time, i.e., December 31, 2007. A brief discussion then ensued relative to the impact on certain bonds issued by the Village for the Holocaust Museum. Mr. Berg emphasized the Village has no legal or financial obligation with respect to these bonds, and the bonds do not impact the Village's budget in any way. Mr. Berg then answered multiple questions from Village Trustees regarding accounting records and the Village's investment policies. A short discussion then ensued regarding the current deficit in the Waukegan Road TIF District Fund. This Fund is currently generating sufficient revemie where it is beginning to pay back the General Fund; however, it can not be determined if and when the debt owed by the TIF Fund to the General Fund will be paid in full. The Board then discussed the Village's internal controls on its payroll process. Ms. Partipilo presented a PowerPoint presentation on the Village's accounts by individual funds Mr. Wade then discussed the Village's financial policy. Mr. Berg confirmed the Village used cash basis accounting for day-to-day bookkeeping of its transactions. At the end of the year, these accounts are converted to the modified accrual basis. Mr. Berg stressed this is a common practice for municipal financing. A discussion then ensued regarding historical reports received by Village Trustees from past Finance Directors. Mr. Berg stated the Village could use a modified accrual basis throughout the year but he does not believe the cost for such accounting would justify its benefits. A discussion then ensued as to the current percentage of the Village's fund balance. After a general discussion it was the consensus of a majority of the Trustees the Village's fund balance should. be maintained at 25% of the operating budget. Mr. Wade then gave a brief presentation on the GASB 45 requirement "that the Village quantify its past employee health benefit cost". A brief discussion then ensued. The Village Board then entertained comments from theaudience. There being no further business, 'T'rustee Minx moved to adjourn the special meeting. The motion was seconded by Trustee Brunner and approved unanimously pursuant to a voice vote at 921 pin. -~- Minu~by: Carol A. I~ritzshall Special meeting minutes.06-25-08 ~ Trustee Kogstad has requested Exhibit "A" be appended to these minutes. 2 EXHIBIT "A" ADD'L MINUTES FROM TFIE VILLAGE OF MORTON GROVE CARF FY 2007 WORKSHOP DATED: 6/25!08 Tirne Indicator: 52 minutes Tr. SM asked for "some indication" of a report on a qtly basis, a % of departments' expenses vs. budget (over/under) DP we have done that in the past, currently review by department. It hasn't been done, but it certainly could be done -qtly basis (would not cause a problem). Don't do 15t qtr. Tr. SM report on qtly or semi-annual basis - to be better informed If no objection, this is something we should look at Pres. RK I agree with you 1 hr 23 min Tr. SM policy 25% fund balance -why used? Auditor DB most commonly used % by my clients Some Gov use a) 25% or b) 33% or c) between 25 - 30%. Toe fine line, too much or too little. Tr.SM maintain fiduciary relationship to maintain health and safety of Village TR. RK 25% is good number to maintain. The GFOA recommendation of 5-15% if you don't have any other fund balances. 1 hr 42 min Tr.DS policy issue of 25% - Is the 25% cash or accrued fund balance? Auditor DB Most people use the prior years audit - Accrued! Tr. DS The 25% that you say is the norm our there, is that accrued not cash? Auditor DB Correct 1 hr 52 min Tr. DS The topic of last years budget came down to: fund balance, is it in cash, or accrued? The answer that was definitely said, it is accrual Pres. RK We also look at cash as a tool 1 hr 56 min DP There are Finance Directors that take cash balance, there are finance directors that take fund balance, our auditor prefers accrual balances. Just a management tool.