1994City of Bangor
MANAGEMENT LETTER
Year ended June 30, 1994
Certified Public Accountants
BRANTNER
THIBODEAU
&
ASSOCIATES
Certified Public Accountants
City of Bangor, Maine
MANAGEMENT LETTER
Year ended June 30, 1994
BRANTNER TTHIBODEAU & ASSOCIATES
Certified Public Accountants
Key Plaza • 23 Water Street
Post Office Box 864
Bangor, ME 04402-0864
(207) 947-3325
January 6, 1995
To Honorable Mayor and City Council
City of Bangor, Maine
In planning and performing our audit of the financial statements of the City
of Bangor, Maine for the year ended June 30, 1994, we considered the City's
internal control structure in order to determine our auditing procedures for
the purpose of expressing our opinion on the financial statements and not to
provide assurance on the internal control structure.
However, during our audit we became aware of several matters that are
opportunities for strengthening internal controls and operating efficiency.
The management letter that accompanies this letter summarizes our comments
and suggestions regarding those matters."
We have already discussed many of these comments and suggestions with
various City personnel, and we will be pleased to discuss them in further
detail at your convenience, to perform any additional study of these
matters, or to assist you in implementing the recommendations.
Generally, we found the City's accounting records to be improved and we
received excellent cooperation from the Finance Department and other City
staff.
Yours truly,
BRANTNER, THIBODEAU & ASSOCIATES
Gerald E. Thibodeau, CPA
2
City of Bangor, Maine
MANAGEMENT LETTER
June 30, 1994
Property Taxes Receivable
At June 30, 1994, we noted a difference of approximately $20,000 between the
subsidiary ledger (master file) and the general ledger. We recommend that
reconciliations be performed on a monthly basis and that discrepancies be
identified and resolved.
Excise Taxes Receipts
During our audit we noted that the excise tax receipts reported to the State
did not agree in all instances with the data retained by the Treasurer. We
understand that these discrepancies were caused by problems with the newly
installed software. We recommend that the City monitor the output of its
excise tax reporting system to be certain that the reports generated are
accurate.
It is our understanding that in recent months the City has resolved many of
the difficulties with its excise tax software.
Sewer Fund
At June 30, 1994, the City maintained a reserve for uncollectible sewer bills
of $20,000. At that time, sewer bills that had been delinquent for more than
one year exceeded $360,000. Although 1993 sewer bills have been liened, it
is not possible to lien sewer bills incurred in prior years. We recommend
that the reserve be reviewed to determine if it accurately reflects the
amount of sewer receivables which are unlikely to be collected.
School Department Records
The accounting records of the School Department were not ready to be audited
for more than eight months after the end of the City's fiscal year. This
condition delayed the closing of the City's FY 1994 accounting records and
its audit report. We recommend that the School Department take the steps
necessary to complete their accounting records on a timely basis.
3
City of Bangor, Maine
MANAGEMENT LETTER
June 30, 1994
Grants, Contracts, Single Audit Act
No one individual in City government monitors contracts and federal and state
grants. There is no master listing of contracts and grants authorized,
applied for, or outstanding. The lack of oversight increases the possibility
that grants and contracts might be mishandled or that compliance requirements
may not be met. We recommend that the City designate one individual to
monitor all federal and state contracts and grants to ensure overall
oversight and compliance.
Fixed Assets
A fixed asset survey of the City assets was conducted during the past year.
The City, however, has not yet implemented the results of the survey. We
recommend'that the City incorporate the results of its fixed asset survey
into its listings of fixed assets. Also, the fixed asset survey excludes
fixed assets of the Education Department. We recommend, therefore, that the
Education Department conduct an inventory of its fixed assets so that the
City's records will be current and complete.
The Bus
Expenditures for The Bus comprise approximately 50% of the expenditures of
the executive department. We recommend that consideration be given to
segregating the accounting for the bus system in a separate department
thereby increasing its visibility and accountability.
4