Auditor-controller Lauren Klein, Cpa Auditor-Controller

R1

The Stanislaus County Auditor-Controller should place the issue with respect to an audit of the Monterey Park Community Service District on the agenda of the Stanislaus County Board of Supervisors. Stanislaus County Auditor-Controller Response: As mentioned in Finding 2 attempts were made by the Stanislaus County Auditor-Controller’s Office during Fiscal Year 2011- 2012 to hire a public accounting firm to perform the financial audit of the Monterey Park Community Service District through the Request for Proposal (RFP) process. This process resulted in no firms participating in the RFP process. An alternative plan was developed to require the District borrow County funds after Board of Supervisor approval to pay for the performance of the audit by the Stanislaus County Auditor-Controller’s Office. Due to the implementation of State legislation and limited resources in the Stanislaus County Auditor-Controller’s Office the alternative plan was not completed during Fiscal Year 2011-2012. During Fiscal Year 2012-2013 the Stanislaus County Auditor-Controller will attempt to implement the alternative plan discussed above. The success of this attempt will be dependent on available resources. During Fiscal Year 2011-2012 certain documents were obtained by the Auditor- Controller’s Office in reference to the performance of the financial audit for the District. A copy of the last financial audit performed for the District was not available. In addition as recommended the Stanislaus County Auditor-Controller will present to the Stanislaus County Board of Supervisors the issue of the Monterey Park Community Service Districts audit at the same time as Recommendation 8 is implemented.

R2

Westport Fire District should submit a time-line for completing its audits to the SCCGJ and the Stanislaus County Auditor-Controller, with a progress update every 30 days until the audits are completed. Stanislaus County Auditor-Controller Response: The recommendation has been implemented. The audit report for year ending June 30, 2009 is dated June 25, 2012 and the audit report for year ending June 30, 2010 is dated June 29, 2012. Both audit reports were received in the Stanislaus County Auditor-Controller’s Office on July 18, 2012.

R6

An audited financial report is designed to provide citizens, taxpayers, customers, investors and creditors with a general overview of the District’s finances and to demonstrate the District’s accountability for the money it receives. These Special Districts are responsible to their public. CGC Section 26909: A special district may, by unanimous request of the governing board of the special district, with unanimous approval of the board of supervisors, replace the annual special audit with a biennial audit covering a two-year period or, if the district’s annual budget does not exceed an amount specified by the board of supervisor’s an audit covering a five year period. A two-year audit cycle provides ample time for the submission and completion of this responsibility. No extensions of audit time frames should be entertained. Stanislaus County Auditor-Controller Response: There was one special district that did request information regarding changing the timing of the audit period from a two year cycle to a five year cycle. Per Government Code Section 26909(b)(2) an audit covering a five year period, if the special district’s annual revenues do not exceed an amount specified by the board of supervisors. The Stanislaus County Board of Supervisor’s approved an agenda item on December 14, 1982 determining the annual revenue amount specified in Government Code Section 26909 to be $100,000. If a special district meets the criteria listed in Government Code Section 26909(b) they are allowed to change their audit period to a five year period.