Agenda - 01-21-20 8-a - Minutes - Laserfiche WebLink

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12 1 Material Weaknesses on Financial Reporting 2 Equity Reconciliation 3 During our testing, audit adjustments were required to adjust the opening net 4 position of the four funds. The entries included adjusting balances incorrectly coded to equity 5 during the current year, as well as to record audit entries from the prior year which were not 6 posted to the County's general ledger. Audit adjustments totaling approximately $2,794,000 7 were needed to correct the County's opening fund balance and net position as of June 30, 8 2019. 9 10 Comments, Recommendations, and Other Issues 11 Industry recommendation 12 The Information Technology environment is characterized by rapid change and there has 13 been no shortage of headlines about cybersecurity attacks. While breaches of large 14 organizations have been very high profile and have received a lot of press coverage, 15 organizations of all sizes face the same types of threats and are experiencing similar 16 breaches. Many organizations are still struggling to effectively address cybersecurity 17 issues; however, they are no longer ignoring them. During the performance of our audit of 18 the financial statements of the County, we noted that the organization is taking measures 19 to prevent such an attack on the County, but is lacking some elements of a Cybersecurity 20 Framework or Cybersecurity Risk Management Program (CRMP). A functioning CRMP 21 will assist the County with comprehensively identifying cybersecurity weaknesses, 22 potential threats and risks, and controls used to safeguard information and systems. We 23 recommend that the entity investigate and consider implementation of a Cybersecurity 24 Risk Management Program including covering the monitoring and testing of controls in 25 place. 26 New GASB Pronouncements - Implemented This Year 27 Statement No. 88, Certain Disclosures Related to Debt, Including Direct 28 Borrowings and Direct Placements, under Statement 88, debt for disclosure 29 purposes is defined as a liability that arises from a contractual obligation to pay 30 cash (or other assets) in one or more payments to settle an amount that is fixed 31 at the date the contractual obligation is established. 32 New GASB Pronouncements for Future Years 33 GASB Statement No. 87, Leases was issued in June 2017 and is effective for 34 the first reporting period beginning after December 15, 2019. This statement 35 increases the usefulness of governments' financial statements by requiring 36 recognition of certain lease assets and liabilities for leases that previously were 37 classified as operating leases and recognized as inflows of resources or outflows 38 of resources based on the payment provisions of the contract. It establishes a 39 single model for lease accounting based on the foundational principle that leases 40 are financings of the right to use an underlying asset. Under this statement, a 41 lessee is required to recognize a lease liability and an intangible right-to-use 42 lease asset, and a lessor is required to recognize a lease receivable and a 43 deferred inflow of resources, thereby enhancing the relevance and consistency 44 of information about governments' leasing activities. Applicable for June 30, 45 2021. 46 Statement 89, Accounting for Interest Cost Incurred Before the End of a 47 Construction Period, this standard eliminates the requirement/ability to capitalize 48 construction period interest costs as part of the cost of a capital asset in 49 enterprise funds. This standard should be applied prospectively with no