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HomeMy WebLinkAbout2011 05.31 Communication Letter Village of Cayuga Heights.pdfCORTLAND ITHACA WATKINS GLEN John H. Dietershagen, C.P.A. Jerry E. Mickelson, C.P.A. Thomas K. Van Derzee, C.P.A. Debbie Conley Jordan, C.P.A. Patrick S. Jordan, C.P.A. Duane R. Shoen, C.P.A. Lesley L. Horner, C.P.A. D. Leslie Spurgin, C.P.A. Frederick J. Ciaschi, C.P.A. Certified Public Accountants and Consultants Ciaschi Dietershagen Little Mickelson & Company, LLP 39 Church Street Cortland, New York 13045 607-753-7439 fax 607-753-7874 108 West Fourth Street Watkins Glen, New York 14891 607-535-4443 fax 607-535-6220 401 East State Street ~ Suite 500 Ithaca, New York 14850 607-272-4444 fax 607-273-8372 www.cdlm.com COMMUNICATION WITH THOSE CHARGED W ITH GOVERNANCE Mayor and Village Trustees Village of Cayuga Heights Ithaca, New York We have audited the financial statements of the governmental activities, each major fund, and the aggregate remaining fund information of the Village of Cayuga Heights (the Village) for the year ended May 31, 2011, and have issued our report thereon dated March 6, 2012. Professional standards require that we provide you with information about our responsibilities under generally accepted auditing standards and Government Auditing Standards, as well as certain information related to the planned scope and timing of our audit. We have communicated such information in our letter to you dated September 29, 2011. Professional standards also require that we communicate to you the following information related to our audit. Qualitative Aspects of Accounting Practices Accounting Policies Management is responsible for the selection and use of appropriate accounting policies. The significant accounting policies used by the Village are described in Note 1 to the financial statements. No new accounting policies were adopted and the application of existing policies was not changed during 2011. W e noted no transactions entered into by the Village during the year for which there is a lack of authoritative guidance or consensus. All significant transactions have been recognized in the financial statements in the proper period. Accounting Estimates Accounting estimates are an integral part of the basic financial statements prepared by management and are based on management's knowledge and experience about past and current events and assumptions about future events. Certain accounting estimates are particularly sensitive because of their significance to the basic financial statements and because of the possibility that future events affecting them may differ significantly from those expected. The most sensitive estimates affecting the financial statements were compensated absences, depreciation expense and other postemployment benefits. Management's estimates of compensated absences, depreciation expense and other postemployment benefits are based on various assumptions. We evaluated the key factors and assumptions used to develop the compensated absences, depreciation expense and other postemployment benefits estimates in determining that they are reasonable in relation to the financial statements taken as a whole. Disclosures Certain financial statement disclosures are particularly sensitive because of their significance to financial statement users. The most sensitive disclosures affecting the financial statements were capital assets, other postemploym ent benefits and long-term debt, the details of which are presented in Notes 4 and 7 of the financial statements. -2 - Difficulties Encountered in Performing the Audit We encountered no significant difficulties in dealing with management in performing and completing our audit. Corrected and Uncorrected Misstatements Professional standards require us to accumulate all known and likely misstatements identified during the audit, other than those that are trivial, and communicate them to the appropriate level of management. Management has corrected all such misstatements. In addition, none of the misstatements detected as a result of audit procedures and corrected by management were material, either individually or in the aggregate, to each opinion unit’s financial statements taken as a whole. Disagreements with Management For purposes of this letter, professional standards define a disagreement with management as a financial accounting, reporting, or auditing matter, whether or not resolved to our satisfaction, that could be significant to the financial statements or the auditor’s report. We are pleased to report that no such disagreements arose during the course of our audit. Management Representations We have requested certain representations from management that are included in the management representation letter dated March 6, 2012. Management Consultations with Other Independent Accountants In some cases, management may decide to consult with other accountants about auditing and accounting matters, similar to obtaining a "second opinion" on certain situations. If a consultation involves application of an accounting principle to the Village’s financial statements or a determination of the type of auditor’s opinion that may be expressed on those statements, our professional standards require the consulting accountant to check with us to determine that the consultant has all the relevant facts. To our knowledge, there were no such consultations with other accountants. Other Audit Matters or Issues We generally discuss a variety of matters, including the application of accounting principles and auditing standards, with management each year prior to retention as the Village’s auditors. However, these discussions occurred in the normal course of our professional relationship and our responses were not a condition to our retention. We would like to thank you and your staff for the cooperation and support given to us during the course of the audit. We appreciate the opportunity to be of service to you and look forward to our continued involvement. This information is intended solely for the information and use of the Board of Trustees and management of the Village of Cayuga Heights, and is not intended to be and should not be used by anyone other than these specified parties. March 6, 2012 Ithaca, New York