El Dorado County Grand Jury
1997-1998
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Findings & Recommendations
5 findings
F1:
The Consultant performed audits for GDPUD from 1981 through 1995 in addition to certain accounting functions with GDPUD management knowledge and approval.
F2:
Generally Accepted Accounting Principles (GAAP) and Generally Accepted Auditing Standards (GAAS) do not allow a self-audit. Government Auditing Standards (Yellow 5 Book) do allow self-audits under certain conditions. The Yellow Book was revised in January 2003 to disallow a self-audit and any appearance of same.
F3:
It appears no Management Representation Letter was presented to the auditor for the fiscal year ending June 30, 2000.
F4:
The General Manager signed a Management Representation Letter for the fiscal year ending June 30, 2002 covering a period of time prior to his employment.
F5:
The Consultant did not have a written contract for accounting services until 2001. There were Letters of Engagement only for the auditing functions signed by the General Manager.
Additional Recommendations
4
Not linked to specific findings.
R1:
An independent audit firm should conduct the annual audit.
R2:
Proper letters of engagement and management representation should be prepared for the audit.
R3:
Board Members and the General Manager should not allow a self-audit or the appearance of a self-audit.
R4:
GDPUD should enter into contracting services with a clear statement and understanding by all parties of work to be done. Responses Required for Findings