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CITY OF MACEDONIA

SUMMIT COUNTY
DECEMBER 31, 1006 ANO 1995
Table of Cont$ntll

El~

(I)

orrtclala and Administrative Personnel

Ql)-(WI)

Index of Funds
Report of Independent Accountants

Combined Sta1em&nt of cash RE>Ceipts. cash DlsbUrsements, and Changes In


Fund C8sl'I Balances All Govemmental Fund Types and Similar Flduclaiy Funds
For the Year Ended Oecembet' 31 .. 199ti
Combined Statement of CaSh Receipts, Cash Dtsbursemen.~. and Changes In
Fund C8sh Balances - All Proprietary Funo 1'ypes and Similar Flduclaiy Funds
For ttle Year Ended December 31, 1996

2-3

Combined Statement ot Cash Receipts, Cash Dl&t>ursements, and Changes In


Fund Cash Balances All $ovemrnen1al Fund Typos and Similar Fiduciary Funds
For tl'le Year Ended December 31. 1995
Combined Statement ot Cash Receipts, Cash Olsbursemonts, and Changes In
Fund Cuh Batnncea -AU Proprietluy Fu!'ld Typos and Similar Fiduciary Funds
For1he Year Ended December 31. 1995

Combined Statement Of Cash Receipts - Budget and Actual


For the Year Ended December 31, 1996

Combined Statement or Cash Ols!:>ursements - Budget and Actual


For tha Year Encled December 31, 1996

Coml:>lned Statement of Cash Reoelpts Budget and Actual


For tl'le Year Ended December 31, 1995

10

Combined Statement of Cash Disbursements - Budget and Actual


For the Year Ended December 31, 1995
Notes 10 1he Flnanclai Statements

1220

Supplemental Oma - Schedules ot Federal Financial Assistance

Reports of Independent Accountants Baaed on an Audit ?erformed In


Accordance wltl'I Government Auditing Standards

--

~--

Co1npllance at the Flnanclal Statement Level


Internal Control Structure at tho (ntlty Level
Reports of lndftl)enctent Accountants Based on an Audit Performed In
Acool'danca wltl'I Office of Management and 81.'(lget Circular A128
,,

General A9Qu1rements All Federal Programs


Specific Requirements NOl'lmajor Federal Programs
Internal Control - All Federal Programs

...
,

32
33
34-36

'

CITY OF MACEDONIA
SUMMl':J' COUNTY
P699 Valloy Vie'# Road
Macedonia, Ohio 44056
ELECTED OFFICIAi.$ ANO ADMINISTRATIVE PERSONNEL
AS OF DECEMBER 31. 1996

ELECTED OFFICIALS
NAME

TITLE

Joseph Mlgllorlnl

Mayor

1/1196. 12/31/00

Mike Menhart

Member

1/1/96. 12/31.IOO

Janet Tulley

Member

111196 - 12131199

Nleholas Molnar

Member

1n194.12131197

Jim Lawton

Member

111/94-12/31197

Barbara Komuc

MembH

1/'1194-12/31197'

AnnaHejduk

Member

111194- 12i'31/97

TERM

SURETY

AMOUNT

PERICO

.ADMINISTRATIVE PERSONNEL

NAME
Thomas OILo:no

TITLE
Finance Olroctor

TEAM

SURETY

Continuous

(A)

Statytory Looat C9umsQ!


Joseph W. Diemert
1360 SOM Center Road
Mayfield Heights, Ohio 44124

(A) Cincinnati Insurance Company


(B) Covers period

."
..........

(I}

.......
,, .....
'

<P

AMOUNT

$50,000

PERIOD
(B)

. City ar Maoadonla

Summlt'County

Index of Fundi

_..

-~ ...

GOVERNMENTAL FUNP JYPE5;

'

, ... I'\'

. GtMrjt EyQdlvpO;
General.Fund .. , .. ,.,.. ~ ...
'

H'

'

"

I,,,..

,,I

'

'

~" Blvgnuti fund J".Ypts


Str89t Constructlon,Mall'lt8n&noe, and Ropalr Fund
Sm1ll Highway Fund. '

PermlulYe Uenae :ru:. !=und : .


Panel.and RecrN.tiortfund .
WatafMalnt&nanoe and Expans.lon Fund
Fire Operating L8ll)' Fund

Vehlcl.. l.IC9n8e:T'.-XFund
Pollot P90aion-Tran.t Fund
Clty tncome.;T.ali.Fund

Drug;-1..aw Enforoement Fund


l..aw Enfofcement Education. Fund
Community Development Bloclc Grant Fund
DARE. Program Fund
Milyor'a Court Computer Fund
Lea1/8rancl'l Wa.~e Management Fund
FAJ.R. Program Fund

::::--....~-

,Debt Service Fund Types:


a.n.rat Obllgatlcn Bond R61lrement Note Fund
Special Aaaoaameni Bond Retirement Fund
Cit,i Hall Conab'uction Bonda Fund
Water Main Construction Note Fund
Highland Road Sewer Note Fund
Fire Cepaftmont Apparatus Note Fund

1001 ROllCI Resurlaclng Note Fund


Caojtal Prclectl Fund~
Capital Improvement Note Fund

OrlflwOod UM Extension Project Fund


State Aout9 82 Widening (Phase 1} Fund
1995/199ffAoad Projects Fund
\

...

Safety $tll'Vlce Facility Fund


BrookpcintStonn Wawr Improvement Fund

Manor House Renovation Fund


Highland POll'lte Parkway Projeet Fund
Highland Road Widening (Phase 1)
eBOPBlETABV fUNO mes

EQ!eror!H Fu(!d Iype1;


Nordonla Hill$ Fun Ffitlval Fund

(II)

STA.TE OP

1111t.1~s

0HJo

OPna Of THE' At.TDrroR

P.O.lbc ll40
Cclumbw. Ohb 4.1216-1140

JIM P!rrRO, AUDrl'OR OP STAn:

T~61~14.

~.om.
~

6l~u90

Report of lnd91Mndent Accounblnta

The Honorable Mayor and


M81T1ber.s o1 Council
City o1 Maeeelonia
Maoedonla. Ohio 44056

We havo audited tho accompanylng financial statements of the City of MaceclOnla. Summit County, (the
City) as -:if and tor the )'81.lrs endocl December 31, 1996 and 1995. ThoM financial statemerrts are the
responslbllltyo1 ttie City's l'Ulnagement. Our rosponslblllty Is to express an opinion on these financial
&tatemonts basod on our audits.

Wo concluc:tod our audits In aecon:lanoo w!th generally aCCGrptod audltlng standards and wmmem
Issued by the Comptroller Goneral of tho United States. Those stanclardS l'OCIUlre that
we plan and perftlrm the audits to obtain reasonable assuranco about wl'lethor tho flnanelal S1atoments aro
1roe of material misstatement An audit lncludos examining, on a tnst basis, evidence suppcrtlng the
amounts and disclosures In tho financial stataments. An audit also Includes assessino the accounting
principles used and slgnHlcant estimates made ty management. as well as ovaluatlng the overall financial
atatomont prosontatlon. Wo believe that our audits provide a rnasonable basis for our opinion.
~Kina Sta!ldal~.

A..-i dl&eusaod In Noto 1, the City propares Its financial statomentn on the cash basis of aecountlng, which Is
a comprehensive basis of accounting other than generally accoptad accounting principles.

In our opinion, tho financial statements roforred to at>ovo present fairly, In all material respects. the
combined fund cash bl:t:ances of tho City, as of Oocembltr 31, 1996 ond 1995, and Its combined cash
receipts and cash disbur:iements for thG years t!'IOn ended on the basis of accounting described In Note 1.
1n accordanoe wtttl Govemmem Au~ltlOQ WOndards, we hove also Issued a roport dated October 6, 1997 on
our eonsleleratlon of tt'le City's Internal control Stl'Uct'.ire and a report dated October 6, 1997 on rts
compllanee with laws and rogulattons.

Our audits woro made for the purpose of forming an opinion on the 11Mnclal statements of tho City taken as
a whole, The accompanying 1996 and 1995 Schedules of FOOoral Financial Assistance are presented for
the purposes of additional analysis and are not a requlrOd part of tho financial statements. The lnformatlen
In tho schedules has oeen sub;ected to the auditing Procedures applied In the audits of the financial
sta'lements and. in our opinion, Is fairly prosented In all rnatetlal resP"CtS in roiatlon to the financial
statements taken as a whale.

October 6, 1997
1

cny OP MACEDONIA
SUMMIT COUNTY

COMOL"lED STA'l'EME.'ll'I' OP CASH RP..c:EIPTS, CASH DlSBURSC."li?NrS, AND CHANGES JN J'IUND


CASH BALA.'lCES ALL CiOVER.'lMENTAL FUND TYPES A.'ID SL"lll.AR FIDUCIARY FUNDS
FOR THE YEAR E."IDED DECEMBER 31, 1996

Spoclal

Dcbl

(''""1'111

~U('

Service

Sl.:21.,314

$3,(1()3.9' 1

$86,:?32

364.606
0
100,43!1
293.647

!528.Z17
0

0
103,798
0
0

Cuib IQlelpUI:
Loail W.01
lnlcr~tal
Spocial UllCllilUCllll

Qw\'Oll f ot JICr'Yicca
flioe., Ucen.c1, and permill
MilOOIJllll>l.la

Toou eub rocelptio

Z?9.S30

'?Qm

10,098
,, 1'.11

Z.05?,174

4,404,J:5

l90,0JO

l.68~.807

160,7!19
0
31:.4113
0
90-3&3
370,4!11
80,30:

0
0
0
0
0
1,142

Cub di1bW'ICmenta:

Current:
Seclll'iry or pcnona and property
Public health llCl"iocl
l.ei1ure tlme activltica
Com.immity <'llvironment
BlMiic utillly ICl'VNleti
Tran,portatioo

97,646
0
:!l'),4(;0

493,902
:SS.!164
l,)47,S37

Geocral go~t
............

""

~,

- ..

Debt Service:
Redemption or princl pol and inten:llt
Capit.111 outlay
Tollll caah di~bul'JCmcmtB

TOUIJ caah l"lCeip!JI oYer/(under) caab di1bllniemen11


Other financing &ooeipll/(dl1bul'lement1):
~ Crom llllle or public debt:
Slllc of bond1

......

''

76!1.13!1

'.'i !l'il

4{'1JR 1 ~

11mop'1R

7M'r17

(Z.031!.IC!2)

3.3JU.097

(S76.247)

c
236.ooo

~.478

Tt'llll'lfen-in

,.

0
lNO

0
0

Salo of llOICtl
Adv811CC4-in
Tt11nafcn-out

!l,000

l!SJ..340
0

(269,400)

(:',4!1"'..,337)

J\dYllllCe..OUt

Other llOlll'COll

Toial othct finlll!Cing tt1Celpw(di1buniemcn11)

I ,9;.li,07K

(S,100)

3!13,713
0
0
0

0
Q,:!r~

!CN9 71 ~

or

&ce.iii; awi ma:ipll and other financing raoeipta


O\lel'f(undcr) caah dibUl'lemcnD ond other financing diabuncmenl/j

Pund wh balancea. J1niwy I, 1996

Fund cmll bllanoea, Dec.cm~ JI, 1'196

(IOZ.744)

178.000

13.466

~1Q.:'~

p!'l;nm

'.IO 771

111 fl,!'IM

Sl~~.'!ltl

The notoa art11 an Integral part of the financial .iatement11

S441:37

...

_, -

...........

,..

......

r ...''

(Memorandum
Onl;i:2
l.;Jtpendldtle
Tru!

Coplllll
Project

--.

-:::-=~-:-

$0

$0

3118.ZSZ
47,130
0

0
0

Tn111l

$4,911,,496
l.;?81,104
l~.9"..JI

331,39S
303,74!1

11.'l,4~

li'.\QQ

:!-4'.\ 4114

560,893

7,1130

7.~1!13

76,53Z.
0
:79
0
S4,757

0
0

l,?Zl,091\

1,431 .

3,0l!S

97,646
'JCS,777
219,460

0
0
0
0

3,IJK,JK6

3.903,3~1

~.~o.~~.

'.\,2S6,lilll

ti,l'il Sr<: l'2

'.'OIS

lMOf,9".JI

(6.054,619)

4,1115

{!1,:S0,77!1)

3,Z64,711
!1,900,043
1,!114,0!ll
196,949
(6;!1,906).
(191,849)
0

0
3

94.971

10,400
0
0
0
1 7!16

6~9,041

720,986
l,4::?8,9KZ.

3.Z64.71 I
6,136,043
4.3:?9.983

Wl,949
(4,337,6.SS)
(196,949)
1756

10 Oti7 9Q9

l::?,1~

Q '.\QQ ll!IO

4,013r1K1

16,971

4,119,0'l!I

M'.\ 4'.'7

l:'i'.:',';!HO

1~m1

S4,6'7ti,1117

~l(iQ,Z.:'i~

S'.'i, 1fi9,0Q6

CITY OF MACED01'1A

SUMMIT COU:-.'TY

.' .
: ........

COMBL'llED STATEMENT OP CASH RECEIPTS, CASH DISBURSEME.,"TS, AND CHA."IOES L"1 FtJ
CASH BALANCES AU. PROPRIETARY FtJND TYPB.S AND SIMILAR FIOUOAR.Y J:o'1JNDS
FOR 'rHF. YEARe.'DED O~ER3!.19%
(M~DlCll'lmdum

Onl:z:~
Total

Agencv

8mo.'\l]!it1e

Operating caah RICCipa:


ChaQ,'Cll fl'!' liCl'YiCCll
Fines, liccn-. llllcl pcnni tll

so

S!S,.566

SlS,$66

22,Q3S

48,72Q

71664

Total operating cub rcc::c.ipt11

:?2,93~

64,:9:S

87.2.,;u

0
0

48,729

48,729

13,68!1

13,68!1

14,:37

14,:!37

6W)

fi.7~

2! O:l6

ti;414

83,4SO

l,900

l,881

3,781

Non-opel'8.ting CMb rcccipu: ,


Other non-opcruting revenue11

14.'i,899

l4S,899

Non-operating caab diKbUl'llCIDClltll:


Other non..openuing c.ll disbuncrnentli

176,647

176 647

1,900

(28,867)

(].6,967)

8,000
0

0
0
0
0

(340)
(S,000)

(ZR,867)

~107)

22A34

~1.m

280,006

S2fi,QQ4

5221!.70~

S2.."iS,6'Xl

Operating cub di~lli:

Gencnal govmimcnt
Public hcaltb !ICl'Yioe>

Contractual ~CCII
Supplictl end lllldcriu111

Tola! operating calih dh1bunementll


Opcnrtini; income

ExCC811 of re.x:ipta OY/(undcr) dillbul'llementi;


bef~ inu:rfund b'lln~feni and advllDOCll
TranRf~in

Advmicett-iD
Trnn1fen;.out
AdVMce5-0UI

Net callh n:ceipl:l over/( under) Cllb diiblll'liCIJlClltll


FuDd ca.'h balanOCll, Janlllll)' 1, 1996
fund Cllllb bll.IWlce~. Docembc:t 31. l 996

I'

(340)
(S,000)
4j6{)

'

I'

f -..

8,000
0

...
CTI'Y OF MACEDONIA
SUMMIT COUNTY

COMBINED STATEMENT OP CASH RECEIP'i'S. CASH DISBURSEMENTS, A..\'D CHA.'llCiES IN FUND


CASH BA.LANCES AU. OOVEAA'MENTAL FUND 'rYPeS AND SLWI..AR. PrDtJCIARY r'UNDS
FOR nm YEAR BNDED DECEMBER 3t, 199S

.Debt.
Service>

Special
R~uc

C".encrai

Cull roccip11:
Local IUeS

S1,0S4.421
406.81.!I
0
103,063
313,490
IOI 416

U!t.c:qOYCl'nlllCOtal
Special~UI

Charge$ for llCl'Yicea

Floe11, 1Jc:en11e11, and pormita


Mi110ellaneou1

$3,377,856
277,!ISO
0

$7S,878

217,611
l.z?C'r

0
6)4,258

n 10KO

()

1.979,:<r.!

3.K97,673

710.130

1,643.27K

13!!.129

0
0
.0
0

Cull dlabllniemcnta:
Cum:nc

Sccuri ty or pctlk'llll Ind property


Public llealth 11CrVicca.
l.liilW'C time activ1tica
Comreunity environmont
Buie utility acrvicea
Trunt1Polrtat.I011
Cenerlll &;OYCmrncnt
Debt Service:
Rodemptlon or prlnclPQJ and ln!e:-:51:
Capillll outl.iy

93,l\l\O .

0
Z22.7'8
480,984

0
308,$611
0
71,445

140,301

34?,716

...

-;;;:..,4J".:

1,.220,063
0
1!1 Tl~

0
S~l~

'.\K170'.\Q

996 '.\44

(l.837,834)

Toca! cull roccipta ovc:r/(undcr) cnib dlbunemenlli

0
0

996
~l!l.274

0
'2,'216.~I)

:.901..129

(1J()6,134)

0
0

. 494,000

Traruifm-in

~063,869

21~

Advmcoa-in

!l,000

IS.JOO

Other financing ~iptl'l(dllibunemeni.):


l'rococd from lllllc public debt:
Sale of llonda
Sale of 001e1

or

TnwJfcn.-out

(3,l;u.848)

349,833
0
0

(24.000)
0

::1i,~iC/,0410

l41Q K'l'I

(:30,000)

AdvancC1'-Qllt
OthcrllllCK

0
0
1 K'.\K lll\Q

ExcoilJI o( CAh rotcipu and other finno.:ing .roooiptll


over/( under) <:ai;h dil:iunoenicnts llJld other financini; diahurlll!men111

...

1,0.'.IS
218,217
!1Q,2~:!

Fund cull MlADcM.Dcccmber31, 1995

The notes are an Integral pan of the financial statements

"~

'

!'76.000

(l?,720)
~000

($ 1!l.'r.!O\

(lki.301)
11707.!
:f.I0,77i

,.

,,

...

'

,.
' '' ~.

:.' .

(MClllOl'lllldlol'!I

Onl:i:l
Clpital

Expendable

ProiciCU

Trull

Tni.I

...
~ so
l,.,!1()4

$0

0
0

0
l,Ol;:I

: 37~:S ......

:111,68'7
31.a,766

'

7 O'.I'.\

tffl~

K,047

6,767,S'.19

$4J()8,154
1119,169

o.

....

..

,,.

634,.:,K
'

.... 1n..a79,..

"

. .

:.,.\

........
'

'

': "

. , ,..

707

16

2,796
0

...

l,'llC.114
93,880

311.3t!l

0
0

:22,7:'!11
:'!52,4:!9
709,660

l,296,.160

3,83:,911

1.90t>.~'36

0
1 RI'.\

'.\,7.w;;;wo

4 '609

107ll0l!OZ

. OS73.862)

3,4311

(4,013,064)

0,

.. 0
2:1,644
0 ..

... ...

l,617,637

...

I,"'

1m110

'~"I

...

'

~.

'

..

'I'

0
3,010,000
l,O:H,93$
18:;849
022.789)
(174,149)

576.000

3,!!04,000
3,66K,I37
::?03,149

10,000
' .
0
0
0

(3,67:1,637)
(198,149)

I)

'\;~7.W

10000

4m7~

l:S3,9M

13,4'.IK

64,436

~4~2

1'.\R R4'.\

$663,4'.17

$1~:!1~80

9ll~

!1114

$1.~0:!1

',

'.

..

"

....,. .........

... __ ...,_,... ".

,
- ................

...

...

,...,.

"

J~

crrY OF MACl:."OONlA
SUMMIT COUNTY

COMBU-.'EO STATE.\'!E.'ll'J' OF CASH RECEIPTS BUDGEI' A."10 ACTUAL


AU. GOVER..'IMENTAL. PROPRtETARY. A.'\'D SIMll..A.R FIDUCIAR.Y FUr.'D TYPE.5

FOR THE YEAR ENDED DECEMBER 31. 1996

Fund Typc!I:

Budget

Actual

vlll'ianCI!

CoYCl'Dmcntnl
Cieneral

S4.1S7,674

$4,264,7.52

$107,078

Spcci161 Rcvcoue
Debt Service
Capiml Projects

4,461.883
762,057
10,693.224

4,6SS,46S
m,743
11.436,648

19J.S82
17,687
743,.c4

Entcll'priRe

20,000

30.935

I0,93S

Fiduciaiy
Expmd.ablc Tni1t

:?0400

10'-.IK6

Propri~

',.

Towl11 (Momorandllm Only)

~1.187.~'.ll

~0.11 !1.2'.IR

.......:... .....

,.,,,,- "'

The notes are an integral part of the 11naneial stataments

414l
SI ,072,20'.1

CI1Y OPMAOIDONIA

SIJMMrt COUNTY

COMBINED STA'IEMENT OF CASH.DISBURSEMENTS. BUOOE'1:A.'IJD ACTUAL


ALL CiOVERNMENTAL. PROPRIETARY,.A.,'Ds:MJLAR. FIDUCIARY.FUND TYPES
FOR'DIE YEAR..E.NOOD DECEMBER 31, 1996.,

ihe notnara.an ln1egral part of thefinanclal statements


9

CITY. OF MACEl>Ol\'lA

SUMMIT COUNTY
COMBINED STATE.\fiTh'T OF CASH DISBURSEMENTS BUDGET Al\'D ACT'UAL
ALL GOVERNMENTAL. PROPRIETARY, AND SIMILAR FIDUCIARY Fl]ll.'D TYPES
FOR THE YEAR ENDED DE~MBE'R. 31. 1995

Fund Typctt1:

..

" '

lludger

Actual

Vario.nee

Govcnuncnllll

Genc::rnl
Sfl"Cial Revenue
Debt Service
Cnpillll Projcctl

Pmprictaey
Enterpri!IC
Fiduciary
Expct>dllble Trust
Totah1 (Memorandum Only)

2,770,926

$4,047,039
4,143,192
Z.:16.270
4,243,278

(1,47"..,3S2)

33.888

33,888

4,609

4,t'iOQ

s J'.\,Z7Q .:!Q~

S14,6XM,276

$4,009,583
4,:44,0~7

2.216,l:'i:

($37,456)
100,845
(18)

C~l.4"K.QRn

. '"
"

,,

The notes are an integral part of the ftl'lanclal statemanis

CITY OF MACEDONIA
SUMMIT COUNTY
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEARS ENDED DECEMBER 31, 1006 ANO 1995

...........
,

1.

SUMMARY OF SIGNIFICANT ACCQUNI!NG eoLICIES


A.

DES.CBIPilON OF THE EN1"!IX

Tho City Of Macedonia Is a body pelltlc and corporate established tor the purpose to exercise
the rights and privileges conveyed to it by the cons1ltutlon and laws Of the State Of Onlo. The
Clty ls a charter city and oporatos unoer a council-mayor form of govomment.
For financial reporting pull)OSes, the City ot Macodonia Includes all funds, aaenc:los, !:>oards
and commissions ovor wt1ich tho City oxerclsos overal:;iht rospenslblltty. GASB 14 and GASS
Codification Section 2100 <laflno thG reporting entity, Which Is dotormlned on the basis of the
scopo of public service and tne City's 111blllty to slgntflcantty Influence ciperatlons, select the
govemlng authority, deslgnate management, and partlelpate In fiscal management On tnls
basis, the reporting entity of the City of Macedonia Includes pellce and fire protection, a
municipal court, swet maintonanco. parks and 1'8C!'G&lion, hoalth, ambulance and general
admlnll;tratlve sorvlcos.
Management believes 1he financial statements Included In .this teport represoot.all of 1he funds
of tne City ov&r whleh the City officials haw tho abl!lty to exerc!so direct operating contra!.

B.

B,o\SIS OF ACCOUNTING

Tho City of Macodonla prep11ros Its financial statt:tments on a basl'J of cash rectilpts and
dl&bt.irsements. Consequonuy, certain revonuos and tne mlated assots are recognized When
received ratnertnan wnen earned. and cer1Dln expenditures aro recognized whon paid rather
tr.an wtw>n tne obl~on Is Incurred. A general fixed asset group and long.tenn debt aroup of
accounts aro not n9COlded on tno financial statements unoor tho basis of accounting used. By
virtue Of onio law, the City Is required to maintain the encumbrance method Of accounting and
to make appropriations.
C.

INVESTMENTS
Investment procedures are restrictod by the provlslono of tho Revised Code. Purchased
lnvestmonts are valued at cost and are neither charged wnen purchased nor credited at the
time Of'redemptlon to their respecti\'e fund balances. Interest earned Is recognized and
recorded when received,

0.

FUNp ACCOUNTING
Tho City maintains Its accounting records In accordance with tho pnnclples of "fund"
:iccountlng. Fund accountlna Is a concopt developed to moet tne noeds Of govemmental
ontitlos In Which logal or other rostralnts require tho ~rdlng cf 51)8Ctfk: receipts and
disbursements. The transactions ot each fund aro renected In a solfbalanclng group cf
accounts, an accounting enti!y which stands separato from the activities reported in other
funds. TM restnet1on11 assoc:latod wttn each typo of fund are as follows:

.......
..... ..

12

Cl'T"V OF MACEDONIA
SUMMIT COUN'N
NOTES TO n..E FINANCIAL STATEMENTS

FOR THE YEARS ENDED DECEMBER 31. 1996 AND 1995


1.

SUMMARY OE Sl.GNIEICANT ACCOUNTING PQL!CIES <CONTINUED\

GOVERNMENTAL FUNQS
,Geperal fund

The General Fund Is the geneial opetating fund Of tl'le City. It Is u&OCI to account tor all flnanclal
resources except ttioao required by law or contract to be accounted for In another fund.

Special Revenue Funds


To account for tho proceuds Of upeclfle revenue sources (othGr than-expenclilble trusts. or
ma)Or capital projects) that are legally restricted to disbul'$Gmer:ts for speclfied pul'J)OSGS.
~bt Soivlce

fUoQS

To account for the accumulation of resources for, and ttio payment cf. genaral long-lerm debt
principal, Interest and relatod costs. According to governmental accounting principles. the debt
llOIV!ce tund accounts for the payment of long-term debt for govemmental funds only. Under
on1o law, the debt ser..ioe fund might also be uaQd to acoount for the payment of the longoten'n
debt of proprlotftry tunda ilnd tho sl'lot1-torm debt of both governmental and propriGtary fundll.

Clta!

pro!octs Euncts

i<> account for flMnc:lal resources to be used for the acquisition or construction of majer capital
facllltles (other than ttlo3e financed by Propnam.ry i:und$ and Tru3t Funds).
Egndab!e Irust Funds

Trust funds are used to account for resources restrlded by legally binding trust agreeman!S.
It tl'le a~reement does not require the City to maintain the corpus of the 1rust, the funel Is
c!asslfled as an expendable 11ust fund.

PAOPBIETABV FUND&
El')lerortse Fynds

To account for operations (a) that are financed and operated In a manner slmUar tc private
custness ente~rlSfls - wl'lere the intent of the ~Ing body Is mat tl'le cos1z of providing
gOOds and services to the general public on a continuing basis be financed or recovered
prtmartty throu~h user charges; or (b) where the governing bOdy has decided that periodic
determination of revenues earned. expanses Incurred. ancVor net Income is appropriate for
capital maintenance, public policy, management control. accountability or other purposes.

F!DUCIABV EUNpS
Agency Euns:!:i

To "ccount for asseui held by a govemmental unit as an agent for Individuals, private
orpanlzatlons, other govemmental units, nndlor other funds.

13

--

CITY OF MACEDONIA
SUMMIT COUNiY
NOTES TO TME FINANCIAL STATEMENTS
FOR THE YEARS ENDED O::CEMBER 31, 1996 ANO 1995

1.

SUMMARY OE ;?IGN!FICANT ACCOUNT!NG PQLl((IES CCON]NUEP

E.

~EJ'ARYPRQCESS
~.

BJd!
A budget of estimated cash rec:elpta and dllSbUrsements Is submitted to the county
auditor, as secretaty of the Coumy Budget Commission, by July 20 of each year, for
the penod January i to December 31 Of <Jie following year.

2. Est!mated Rosou

The County Budgot Commission certifies ~ actions to the Clty by September 1. As


part of th!s cartlflcatlon. tho City receives 1hc offlclal certificate of estimated resources
which states tt'IO projec!ed receipt& of oach fund. On or about Janua:y 1, this certificate
Is amended to Include Mo/ unencumbered balances trom tho preceding yliMll'. Prior to
December 31, the City must revise Its budget so that tho tctnl can1emlJ\ated
expondlturos trom a runes during the ensuing fiscal yoar wlll not exceed the amount
stated In the cortlflCate of estimated resouroos. The revised budget then serves as the
basis for tiie annual appropriation moasure. BudQmacl roeelpts as ahown on the
accompanying financial statements do not Include January 1. 1996 or iws
unencumbered fund balances. However, these fund balances are available for
appropriations.

3. 6Qproprlntl2ns
A temporary appropriation measure to control c:ah dlsbursoments may be paued on
or abOut January 1 of oach yoar for tno period January 1 to March 31. An annual
appropriation measure must bo pasaod by Aprll 1 of eaeh year for the period January

1 to December 31. The appropriation measure may be amendod or supplementod


during tl'le year as new Information becomes available. Appropriations may not exceed
estimated resouroes.
4. Encum!2mnces

The City la requlrod to u&e the encumbranco method or acooun1!ng by virtue of Ohio
law. Under this system, purchase orders, contracts. and other commitments tor thG
expenditure or funds are recorded In order to roservo the portion of the appllc:able
appropriation

... .
' '

eaetr fiscal yoar, !ha unencumbered balance of each appropriation


reverts to tho respective fund from which It was apl)l'Ol)rlated and becomes subject to
MUre appropriations. The oncumbffred appropriation balance ia cal'Ti8d forward to tho9
succoedlng fiscal year and nood not oe roappropriated.
At the close of

.........
-
~--

F. PROPEff!"V. PLANT AND EQUIPMENT

Fixed

assetS

acq1.1lred or constructed. for general govemmental service are recorded as

expenditures. Depreciation Is not recorded for tl'IOse fixed assets.

14

CITV OF MACEDONIA
SUMMIT COUNTY
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEARS ENOEO DECEMBER 31, 1996 ANO 100:>

1.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES CCONTI~m


G.

,6iCCUMULA!ED UNPAID VACAI!ON ANO SICK PAV


Accur:iulatecl unpaid vacation and sick pay aro not accrued under the cash basis of accounting
described in Noto 1. At. Oocember 31, 1OQti, menagemont estimates that $314,434 in sick
lfHlve and $54,500 In vacation leave l'lllve beon accumulated by the employees o! 11'19 City.
All leave wlU either be abfilOtt)ed by time off from v..ork, or within certain limitations, be paid to
the eml)IOyeeL It Is not practlcablo to determine 1he actuarial value of these benefits a:s of

December 3i. , 996.

H.

IQTAL CQLUMNS ON FINANCIAL $T.".TEMENTS


Total COiumns on !tie financial stntemon1s are captioned "Memorandum Only" to Indicate that
they llf9 presented only to faclllta1e flnanclal analysis. This dam Is not comparable. 10 a
consolidation. lnterfundotype eliminations have not been made 1n the aggregation of 1hl dllta.

2.

PQQ!.i="O CASH ANQ lfSYE$Th1ENTS

The City maintains a cash and Investment pool u!Hld by all funds except ~.Municipal Court Fund.
Eacn fi;nd type's portion of this pool ts displayed on tne Combined Statement of Cash Receipts,
Cash Olsbursemonts, and Changes in Fund Cash Balanees. The cash assets of tho MunlClpal
Court Fund are held separately by tho City.

'

'

~eaulremonts

Ohio law requlreo the ciasslflc.ntlon Of monoys held by thO City Into three categerlss, which
determines the typo of lnvosb1ronts Which can be made. Categoiy 1 consists of acttve mon.ys,
those moneys requlrod to be k0f)t In a
or near-cash" status for lmmGOJate use by the City.
Such moneys must be maln1alned either as ca&h In tt'lo City treasuiy or In depository accounts
paynDle or wtthdrawable on demar.<I, Including negotiable order of withdrawal (NOW) accounts.

easn

Category 2 consists of inactive" monies, 1hOse 110neys not 1'$qUlrod 1or u:oe within the cul'T8nttwo
year period of designation of deposltorleS. tnactlYO moneys may tie depOslteCI or invested only as
certificates of deposit maturing not late:' than the end of the current period Of designation Of

doposltorles.

Category 3 consis1s of "Interim" moneys, those moneys which are not needed tor Immediate use but
which will be needed before the end Of the current period of del)Osltorles. Interim moneys may be
Invested or deposited in the following llOCUritles:

1. Bonda, notos, or other obllgetlons of or guaranteed by the !;.4:"..'tda.618.tos, or those for which the
lalttl of the Untted States Is pledged tor the payment of principal and lnterttst
2. Bonds, nctes, CIGbentUres, or other obligatlOr.s or socurltles Issued by any federal government
agency, or the Export-!mport Bank of Washington;
3. Repurehasa agl'ellments In the securities enumerated abolle;

4. Interim deposits In t!'le ollglble lnst!Mlons app~/ing for Interim monies:

.,

'

15

CITY OF MACEOONIA

SUMMIT COUNTY
NOTES TO THE FINANCIAt. STATEMENTS

FOR iHE YEARS ENOE.O DECEMBER 31. 1996 ANO 1995

3.

pear OBLIGATIONS
Debt outstanding at December 3i. i 996 consisted of the follov.ing:
Special Assessment Bonds
Principal Outstanding
lnt91'8st Rate 4.5% to 6.25%

.....

'

$1,230,211

General Obligation Bonds


Principal Out:danding
Interest Rate S.25% tO 0.05%

3,031,000

Bond Anth:ipatlon Notes


Principal Outstanding
Interest Rate 4. i 5% to 4.70".4

6,i36,043

Truck Lease-Purchase

26.585
$10423 839

Total

The special assessment bOnd procll9dc wero used tor various stteet lml)l'OYementa wttn!n the City 'that
have bOon assetWed against the affected propor1y owners.

"!'ho outstanding general obligation bonds constst of construet1on Issues. General ob!!gatlon bonds aro
direct obllgatlens of the City for which Its full faith, credit and resourcos are pledgod and are payable
from taxes levied on all taxable property In the City.

Tho ~Ulndlng bond anticipation note proceec:lt were used for construction and maintenance or th9
Clty'a roads, Installation
sewor lines, construet\on or t:'le City's safety mm1lco 1aclllty and ~ the
purchaso o1 a fire truck.

Amortization of the above debt. lncluctlng lnto!'est. is schodi.:19CI as tollows:

Special

General

Bond

Assessment

Anticipation

Bonds

Obligation
~

.I.ml

i997

$293,000

$75.878

$295.890

$14,490

1998

282.080

416,507

448.655

i-i. 490

1999

271,525

416,488

4i8,363

2000

104,833

415,544

638,298

2001

101 ,852

4~5.771

619,465

Subsequent

537,500

2.343.109

6.814.69i

$].590:880

$4.Q8il.39Z

!2,235~

Vttar ending
~

'

..

Total

;.

17

Q
$28.ft80

CITY OF MACEOONIA

SUMMIT COUNTY
NOTES TO THE FINANCIAL. STATEMENTS

FOATHE YEARS ENDED DECEMBER 31. 1906ANO1995

4.

PAOPEBD' TAX
Real property taxos are levied on a:Jsessed Vftlues Whld'I equal 35% of aDPralsed value. The county
audttor reappraises all real property every six years wilh a seltnnial ul)date. The last update was
completed for tax year 1996.
Real proporty taxa.. become a lien on all non-exempt real property locateid In :he county on January

1. Real property taxes aro i;iayable annually or semiannually. If paid annually. payment Is due
December 31; If paid semiannually, tho first payment Is due Oocembm' 31 with the remainder
payable by June 20 of the following year. Undor cortaln circumstances. state statute permits later
payment dates to be established.

The full tax rate apptlod 10 real propertyfortt'le fiscal years ended December :31. 1996 and 1995 was
$9. 1O per $1
of a'50ssed valuation. After adjustment of lhe rate tor lnftatlonary Increases In
propeny valuea, the effoct!ve tax rate was $5.32 and $5.36 per $1000 of~ valuation tor real
property classllled as resldentiallagrlcultural and SS.ZS and $5.08 per $1 ,000 of assessed valuation
for 1111 other real property.

.ooo

Real property owners tax bills aro further reduced by homHtoad and rollback Cleduct!Ons, when
applicable. The amount of those homestead and rollbllek reductions Is reimbursed 10 lhe City by lhe
State of Ohio.

Owners of tangible personal property are required to file a list ot such property, Including costs, by
April 30 of each year. The property lu assessod for tax purposos at varying statutory percentages
of cost The tax rate applied to tangible personal property for thO fiscal years ended December 31,
1996and1995 _was $9.10 per $1000 of assessed valuation.

1996

Real Property- Valuation


ReeldentlaVAgrlcultural
CommerelaVlndustrlal

""
..

"'

$101,019,440
41,140,590

Tangible PorsoMI Property- Valuation


General
29.339,950
Public UUlltles

25.032,856
19.593.320

26.848.350

Total Valuatlon

The Summit CoYniy Treasurer collects prof)IWty tax on behalf of all taxing dlstrlds within the county..
The Summit County Auditor periodically remlla to Iha tBldng dlstrlets their porUO!'IS of ttie taxes
collected.

5.

LOCf\~ INCOME TAX

This locally levied tax of 1.sk Is applied to gross SJJ.larias, wages and other personal service
compensa1lon earned by residents both in and out of the City of Macedonki and to earnings of
nonresidents (except certain transients) earned In the City. It also applies to the net Income ot
organizations that conduct bl.lsloess wltl'lln th& City of Macedonia. Tax recelpts are credited to the
City Income Tax Fund and amounted 10 $3.376,385 and $3, 17':,289 In 1996 and 1995, respectively.

18

CITY OF MACEOONlA
SUMMIT COUNTY
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEARS ENDED DECEMBER 31, 1996 AND 1995

6.

INSURANCE
.

,,'

The City maintain& comprehenslve lrnurance oovemge witt'l l)rlvate carriers for real property, bUllding
contents, and vehlclels. Vehicle pollcieS tnclUde llal>lllty coverage for t>odlly Injury and property
damage. Real pl'Of*tY and contents are fully Insured.
EHec:llve May .,i, 1"92, the .Cit'/ establlllhed a self.funded Health. Beneftt. Plan., Tho plan.ls
admlnlst91'9d, by Managed Care of Amer1Ga, Inc. .and Is funded entirety ~ the City. The City la
responsible 1or the flrst $12,000 of tlaims per individual. The City Is Insured by Commercial Ufe

Insurance ComPM'f fol' Claims In excess ot'Sizooo per Individual, effectilte Jitnuaiy 1, ioos.ttvough
D:ember 31, 1996. The contract Is amended and renewed each year.

7.

BEDAEMENTCQMM!TMENIS
,, ,

:~

The Public employe0~ Retiremont System of Ohio (PERS) Is a state oporatod. cost-sharing, multll)l6

employer public employeo retirement system. Fulltlmo permanent employ(les of the Chy belOng to
PERS. PERS proyldes retlremont beneflta10 employeoa Who are eligil)lft to nitlre bued upon ye11ra
of aeivico., PERS.also provides Guivivor and disability benefits to vosted employet;s...
' '
.
'
.
.
'
Employees contribute 8.5% of their gross salary. The employer mo.tchlng sl'lat'G is 13.55% of gross
salary. Tne penaalOn contribution requirement.tor the City lot the yaara ended Oecember.31 .. 19D6
al'ICI 1995 wu $360,01.1 and $320,731 which:cons1sted.of $.143,478 and $122,'1'19 from.employees
and $216,533 and 98,011 from the employer. The required percentages for employer and
employee cor.tr1butlons for 1007 remained the same.
~

si

--~

Police and Are employees are COVOl'OCI by tho Police and Firemen's Disability Pension Fund. Pr.illce
and firemen contribute .10%.of 1helr gross wag.and the City matx::ties this wtth a con1l1butlon eciual
to 24% of fil9nlen'a ,salary. and 19,5,4 of pollc9men's gross wages. The penslOn contribution
requirement for 1he City for the year ended Cecember 31, 1996 and 1995 wu ~.406 and S
216,622whleh consisted of $77,881 and $71.ZZ4 from ~mpl~s and Si45,52S and $145,398.

.....
.

from the employer. The required percentages for employer and employee conllibutlons for 1997
remained the same.

6.

EMPLOXEE~ Ql;FERRED COMPEt)SAJlON PROGRAM

Employees of the City or IV.acedonla may elect to participate In the Ohio Public Employees Oeferred
Compctnsmlon Program andfor tho Aetna Life Insurance and Annultj Company's deferred
compensation program. Under these programs, employ!Mts elect to have a portion of their pay
c"lferred until a fut\lre time, usually aftor retirement. The de!::ra.:l pay and any Income eameCI on
It Is not subject to Income taxation until actually received tJy tt'le eml)loyee.

As (lf December 31, 1996, fund:s on deposit with the Ohio Public EmplOyees Deferred Compensation
Board totaled $55,981. and funds on depOslt with the Aetl'ltl Insurance Company tQtafee ~.669.
Under the terms of the dOferred compensation plan agreement, '1ese funds are the property of the
City, although the&e amounts are not renectect In the accompanying financial statements. Also not
refloctld In such Slatements Is a liability to 1he employees participating In th9 plan, eQual In amount
:o the funds on del)Osit. Participating emoloyees are gonoral aedltors of 1he City with no prefef'entlal
clelm to tho deferred funds.

20

~:::::~:. .

CITI' OF MACEDONIA
SUMMIT COUNTY
SCHEOUl.E OF FEDERAi. FINANCIAi. ASSISTANCE
(CASH BASIS)
FOR THE YEAR ENOEO DECEMBER 3i, 1996

...

''

'~

"'

:;;.:,.: ......
',. '

21

RECEIPTS

$0

OISB:.JRSEMENTS

(B)

$31,059

2!5,000

25,000

$25,000

$56,059

(A)

.,

..... ".
'\<i

. ... ..

22

......

.....

CITY' OF MACEDONIA
SUMMIT COUNTY
SCHEDULE OF FEDERAL FINANCIAL ASSISTANCE
(CASH BASIS)
FOR THE YEAR ENDED DECEMBER 31, 1995

FEDERAi.. GRANTOR/

FEDERAL

PASS-THROUGH

PROGRAM

PASS TMFIOUGH GRAN"!'OR

CFOA

PROGRAPJ Trn.E

NUMBER

GRANTOR'S
NUMBER

ORAWARO.
AMOUNT

U.S. Department of Housing and


urt>an 0eve1oement
Pa$S&d through Summit County

Departml?nt ot Planning and Economic

Development
Commun!ty Development Block Grant

14.218

B-95-Uc-39-000

16.710

95-CF-WX3949

$131,700

U.S. Deparnnent of Justice

CopsGra:it

Total Federal Assistance

(A) Nonmajor program tested under 50% rule


(B) Reimbursement rec&Ned In 1997

......

:::;.:~ ..~

23
'

75,000

DISBURSEMENTS

RECEIPTS

so

-.f'~

(8)

$52,883

25,000

25,000

$25,000

m.883

(A)

:.:. : ..~:.

24

.---
,_..,.--

911 C...t llc-1 s -

""

STATE ()P OH10

OP1'1c:n OP THI? Auorro1t

1'.0.
~140
CoiWN>w. Olw. 4.1:1l6"l140

JIM PlmlO, AUDITOR OP STATE

T..i.phorw

61~4

ao:>-2112-0370

Jlacalmlle

61~90

Report of Independent Acco41ntama on Compliance tit tlM Financial S ..twm. It L.wf

The Honorable Mayor and

MembGrs Of Council
City of Macedonia
Macedonia, Ohio 44056
we havo audited the financial statements of the City of Macodonla, Summit County, (the City) aa of and for the
years ended Docembor31, 1996and1995, and have issued our report thereon dated Odober6, 1997.

oUr

we conducsed
audits In accordance with gonorally accepted audltlng-mtlnd:.-:15 and~ ,
Stnoclott1s. Issued by the Comptrollor General of the Unlted States. Those S1andarda require that we plan and
perform the audits to obtain reuonable assurance about whothor the financial statements are free ot material
misstatement.
Compliance with laws, regulations, contracts, and grants applicable to tho C!ty Is tl'lo responslblllty of the
managemont of tho City. A:J part of obtaining roMC>Mblo a:JSuranco about whothor tho financial statcmonta
are tnM of material mlsstntemont, we portormod tests ol the City's compliance with certain provisions of laws,
regulations, contracts, and grants. However, the objective of our audits of the financial S1atoments was not to
;:>rovlde an opinion on overall compliance wit:'! such provisions. Accordingly, we do not OXl)l'8SS such an opinion.
The 1'9SUlts of our fe8ta disclosed th9 following Instances ~f noncompliance that are required to be reported
herein under Gwmment Ayd!tjng StaQdarcts . !toms preceded by an asterisk C-) are repeated from the prior
audit.

Cltat!(?n:;
i.

Ohio Rev. Code Section 5705.41 (0) states thllt no subdivision shall r:-.alo;e any contract or order any
EIXl)endlturo Of rnonoy unless the oortlfleate of the fiscal oftloer Is attached. The fiscal officer must C8l'tlty
ttlat ttie amount roc:iulred to moot such commitment has boen laW1ully appropriated and Is In the
treasury or in the process of ccllectJon to the credit of an appropriate tune, free from ar:y prevlOus
oncumbrances.

The required certificate was not attached to any of tho purchase or contract transactlonn examined.
2.

Ohio Rev. Code Soctlon 149.43 requires that public dOC'.imonts be mado avallable 1or lnspec:tion.

The Fun Fest drawing tleketstubs forcalondoryears 1996 and 1995, the calendoryear 1995 Fun Fest .
craft and food booth applleationS, and 2 out ot 8 calender year 1996 Fun Fest craft and fOOd booth
appllcatlDns wore not available for Inspection.
3."

Ohio Admln. Code Soctton i 17-6-01 states tliat cltleis al'9 required- to report In accordance with
generally accepted accounting principles.

The City elected not to report In accorcs.nce wtth generally accepted accounting pr.nctples as of and
1or the years ended December 31, 1996 and 1995.

25

City Of Macedonia
Summit Counly
R&;:IOrt of lnd"1)91'10ent Accountants on Compliance at the Financial Statement Level

Page2
4.

Ohio Rev. Code Section 9.38 mqulres that a publle 01ficlal other than a state otricer, employee, or agent.
ahall depoolt all public monies recelved by him with the treasurer of the public Offloe or properly
designated depository One$ every twenty-four consecutive hours.

The Income Tax Oopartment, Parka & Recreation t)ei)artment. BuHdlng Oef)artment and the Mayor'&
Court did not deposit all public monies received with 1he fiscal officer or a designated deposltCMy wlelln
a twonty-four hour period.

5.

Ohio Rev.~ Section 5705.41 (B) prohibits a Sl.lbdlvfslon from making an e>cpenclituro unless It l'laa
been properly appropriated. The following funds were found to have e>ependltures which elCCMded
approprlatlor.s:

ms General Fynd Typo:


.General Fund

1995 CMltal Promew fynd Types:


Hlgl'lland Polnte ParkWay Pro)ed Fund
Highland Road Widening (Phase I) Fund

1996 SQtcial Reyenue Fund Tyoe:


City Income Tax F=und

1996 Qtbt Seivice Fun Types:


Highland Road Sewer Note Fund
Flra Department Apparaws Note Fund

1996 ~ap!tal ProlectJ Eu!ld Types:


DriftWOod Lane ExtenSIOn Project Fund
199~996 Road Projects Fund
Safety Service Facility Fund
Highland Pointe Parkway Project Fund
Highland Road Wloonlng (Phase I) Fund

.flrld!ngs for Recoverv

1.

The City held a rame In 1996. The total expected amount of proceedS from 1he rame was $2,-403. This
amount was calculated based on the total number of raffle ticket stubs, and Included stubs that could.~
not be located. The actual amount of prooeeds deposited and recorded ais raftb tleket revenue wu
$2,097, leaving $306 unaccounted for.
In accorc::lance with the forgoing faets, and pursuant to Ohio Rov. Code Section 117..28, a i:indlng for
Recovety for public money COiiected but not accounted for Is hereby issued ag~ John Houser, Parks
and Recreation Dlroc:tor, In the amount of three hunclt9cl sbc dollars ($306) and In favor of the City o1
Macedonia.

26

Cl1y ot Macedonia

--:.

Summit County
Report of lnclependent AcCOuntants on Compliance at tho Flnanclal Statoment Level

Page3

2.

The City also held a raffle In 1995. Paymonts In the amount of $94.97 were made from the proceeds
rrom the sale of raffle tJckots, but no documentation of tho naturo 01 the.10 payments could be provided
Dy the City.
Jn accordance with the forgoing tacts, and pursuant to Ohio Rev. Code Soctlon 117.28. a Finding for
Recovery Is hereby Issued against John Houser, Parka and Rec:reotton Olrec!Or, In the amount of
ninety-four dollars and 97 cents ($94.97) and In favor of the City of Macedonia.

3.

A ~yment In the amount of $100 was made from receipts collected by the City for registrations 10 play
Doskett>all. No documentation of tl'lo nature of thO expenditure could bo provided by tne City.

In .accordance with the forgoing facts, and pursuant~ Ohio Rev. Code Section 117.28, a Finding tor
Recovery ts hGfeby Issued against John Houser, Parks and Recreation OlrtldOl', In t'le amount of one
hundred dollars {$100) and In favor of the City of Macedonia.

We considered these Instances of noncompllance In forming our opinion on whether the City's financial
statements &re presented fairly, In all material re1i1pects. In conformity wlll'I the cash baSls of accounting, and
tt'lls report does not affect our report datad October 6, 1997, on thoso flnanclal statements.
Wo aloo notOd certain OthOI' Instances Of noncompllanco and certain other matters Involving the lntemal control .
structure that we have reported to the management of ttle City In a separate letter dated Oetct:>er 6, 1997.
. ... .
,

.. .

This report Is Intended for U'le information of management ar.d Council. However, this report is a matter of
public record and Im distribution Is not limited

October6, 1997

..,

..

r..

r.: -

I :

27

...--

,,_ .....

u 6-t Blood sa-t


p.o. BID< 1140

S'tA:rE OF OHIO
Ol'PICE or THE Auorroa

Colwnbuo,
T.i.phoM

JIM

PE'rRo, AtJOrTOR Oii STATE

""'

4TZ16-ll.O

61~ ... -

f10D.2112-m0- ..

~6~

~of Independent Accountants on

the lntltmal Control Structure at the Enttty Uwl

il'le Honorable Mayor and


Members of Council

City of-Macedonia
Macedorila, Ohio 44056
We have.audited lhe financial statements of tho City of Macedonia, Summit C,,uoty, (the City) as of and for
1t1e years ended 06cember31, 1996and 1005, and navo IS$ued our report thereon datecl October6, 1P97.
We conducted our audlta In acoordanoe with generally accepted auditing standards and GQ.'tmJ'll'Mflt
81tdltlng Stnnctaros. laaued by the Comptr0ller General of the United Statos. Thoae standards require that
WG plan and porform t!':et audtts to obtain reasonable asaurance about wt"...,iher the financial statements are
tree or material mlssui.tement.

The managament of the City is responsible for establishing and maintaining an Internal control structl.lre. In

tulfllllng this responsiblllty, estimates and judgmontll by managl!lmont are roqulrod to assess the expected
benefits and related costs o: Internal control structuro policlos and proeeduras. The ObjectJves or an internal
control structure are to provtcso management with reasonable, out not absolute, assuranca that ass<lts are
safeguardQCI against loss from unauthorized USl'I or disposition, ar~ that transactions are exocutod In
accordance with managemenrs authonzation and recordOd property to permit the preparation of financial
statements In accordance with the cash basis of acco1mttng. Bec:ause of lnhoront limitations In any Internal
control structure, errors or lrregularltles may nevertheless occur and not be d&toc:ted. Also, pro)edlon of any
evaluation of the s"J\lcturo to future periods is subject to the risk that proceoures may oocome inadequate
becauoe of changes In conClltions or that the effectiveness of the design and operation of policies and
.. .

procodure:i may doterlorato.

In planning and performing our audits of tho financial statomonta of the City for the years ended December
31, 1996 and 1995, we obtained an uncierstandlng of the lntomal control stn.lcturo. With respect'll:I the
Internal control structure, we obtained an understanding of tho design of relovant policies and procedures,
and whothel' they have been placed in operation, and wo assessod control risk In order to detefmlne our
auditing procoduros !or the purposo of expressing our opinion on tho financial statements and not 10 provldo
an opinion on the internal control structure. Accordingly, wo do not express such an opinion.
Wo noted certain matters involving the Internal control structure and Its operation that we consider to be
reportable conditions undor standards established by the American lnstttute of Certlfiod Public Accountants.
Reportabie conditions involve matters coml~ to our a.ttontion relating to significant deficiencies in the
design -or operation of the Internal control structure that. In our judgement. could adversely affect the entity's

ability to l'GCOl'd, piocass. summartz9, and roport flnancial data consistent with the assertions Of
management In the tlnanclal statemtll'lts.

_... ...
;:.,.,......-

28

Cny of Macedonia
Summit County
Report Of Independent Accourrtants on the
Internal Control Structure at the Entity Level
Page2

Beoortab!e CoQditloni;
1.

Purchase order amounts were not posted against appropriations or errtured into the ll)'Stem until th9
time of payment. This could result ln oxpenclituros oxcoedlng appropriations.
Purchase orders shou!d t>e posted against appl"O$)riatlons at the time the City Incurs an obllgatiOn to
purchase ~ or services, not at tt.o time of payment. ThlS provides financial decision makem
with current, accurate information about the unappropriated balancos of oach tune!.

2.

TOO amount of money actually collectod and deposited for1he Fun Fest rame and drawing tickets
was not roconciled to the amount which should haw beon colloctod. This could result In monies
being collactod but not deposltod Into the City's accounts.
Arter each rame and drawing, the amount of mol'IO'/ which was collocted and deposited should be
reconciled to the amount or money which shOuld have boorl eollectod. The amount or money which
should have been collected can bo calculated by multiplying tho numbOr of tickets sold by tne price
Of each ticket. A copy Of the reconclllatiOn shOuld be Initialed by the preparer and rotalned by the
City.

3.

Pronumberod books of Fun FGst tlckots wore dlstrlbutod to the' various Individuals who-were to sen
them. The City did not rocord the names of the !ndlvlduals who ft'ICOived the books of 11ckets. Also,
the books of tickets were not issued In sequential order. These situations resulted In the Clty being
unable to account for all monies rocelVod from tne sale of Fun Fest tickets.
A log, which matches the tleke! books lasuod with the pel'IOl'l who received them and the numbers
of any tickets retumoc:t as unsold, should bo maintained by the City. Tlckot books also should be
lssuod sequonUally. This would aid the City In accounting for all proceeds from th& sale of Fun Fest

tickets.
4.

Paymttnts, which amounted to $94.97 In calonder yoar 1995, were made from tne proceeds Of mnta
tlckot sales prtorto tne proceeds being deposited Into the City's accounts. There was no supporting
documentat:on for the payments. This rosulted In monies being collected but unaccounted for Dy
the City.
The gross proceeds of the Fun Fest raffle should be deposited wlttl the Flnanoi- Director, and any
related disbursements should be made by tho Finance Olroctofs olflce.

5.

Although the City Council monitored expenditures, there was no evidence that Iha City Council
monitored the other financial actlvltlo5 and records of the City. Failure to monitor 1he financial
records contributes to a tono of Indifference which could result In employees not usl~ due care
during the course of their work. In an environment where one pel'50n Is solely responsible for lhe
maintenance and preparation or proelomlnantly all financial records, lack of adequatl9 monlt:>rtng by
an Independent party could allow errors and Irregularities to remain undetected tor a significant
amount of tlmo. This decreases thO rollablllty of thO financial records.
The City Councn should consldOr ostablishlng an audit committee to lnteraet wlth thd City's
Independent audl~rs and to monttor thi9 flnanctal record!!!, or consldor modlfylrtg too respornolblllties
or the Finance Committee to Include theso duties. In addition, Counell should consider establishing
pollctos ancl procedures whieh specify the financial information that the Finance Director should
submit to the Council monthly. Such Information should Include monthly bank reconclllatlons,

..

City Of Macedonia

Summit County
Report at Independent Accountants on the
Internal Control Structure at the Entity Level
Pago3
monttity financial lltl:ltements, a. racolpt and dlSbursemem ledger, 4n appropriatlOn !tll'Ws report
which show& appropriations and eix;:>endltures, an lnvefitment ledger, a monthly report o1 Mayor's
Court activity, etc. This will Improve the rellabUlty of tho financial statemonu by allowing for timely
detoction of e1TOrs ane! lrrogularltles and eS1abllsh a tone In the organization wrilch emphasizes th&
Importance of reliable financial records.

e.

The soccer end basketball regiStratlons were not malntalned on me. This could have resulted In
monle!. being collected, but not deposited Into the Clt</s accounts.

At the end of each day, tJ'loa amount of the soc:er and baskotball registration fees collected $h0uld
be reconciled to the amount that should have been collected. This amount CM be calculated by
multiplying the fee listed on the registtatlOn by the number of registrations. The reconcillatlon
shOuld be Initialed by the preparer and retalnod by tho City. Also, a roster of eaeh activity lShou!d be
propared by the coaches and compared to thO registrations to ensuro that all proceeds aie
acoounlod tor.
7.

The City did not maintain documontation of the Individual transactlons that wore presented In total
as reoonclling Items on the monlhl'/ bllnk reconclllatlons. This could have resulted In a lou of

accountability over City bank accounts.


The Cty shoulC: maintain a detailed list of all Items that are used as reconciling Items when
performing the montht/ bank rcconclllatlons. This would provide additional accountablllty owr the
City's bank accounts.
':':-:;::. :: ..

e.

During calender years 1996 and 1995, the City had negattw bank t>atances at var:ous times and

had Issued several non-sufflclent funds (NSF) Che<:ks, Including one In the amount or $473,814
during 1996. All or these checks were honored by 1he bank. As a result of these conclltlOns, the
City had to pay approximately $430 In bank chargea during 1996. The negative bank balanees and
NSF checks Indicate a tack of monltorlno or the City's flnancer.o.
In order to avoid negative fund balances and the rosultlng NSF checks and bank Charges, the City
should Implement monitoring controls over the City's cash flow and financial records, such as the
timely preparation and review of bank reconciliations and making bank deposils on a dally basis.

;:::::...

9.

The Income Tax Clerk. Mayor's Court Cieri< and other departments did not receive a monthly
financial 3tatus report trom the Finance Director. This resulted In the various departments being
UnablO to reconcue their subsidlaty ledgers to thEI City's ledgors.

Montnty flnanclal status roports should be glvon to tho Income Tax Clerk. Mayor's Court Clerk and
all City Dopartment Heads each monlh and then 1'9COnciled with thelr auDsldlary records ao that any
tHTOl'U may be detected and oomJCtecl In a timely rnannor, The Income Tax Clerk. Mayor's Court
Cieri< and the Oepartment Head (or a doslgnee) ahould Initial and date the reconc:Ulatlon once It tiaa
boon reviewed tor accuracy. Tho reoo!Y.:lllatlon ohOuld be maintained on flltf to holp establish

accountablllty.

30

City of MaeedOnla
Summit County
Report of Independent Accountants on the
Internal Comror Stl\lcture arthe Entity Level

Page4
~

o.

The Finance Oej)artment did not lesuo a receipt to either the Building ~!'?tor the Parks and
Recroation Oepartmer:t wheln 1t'9'f presented their dally receipts to the Finance Cel)artment. This
could re&ult Jr, monk'ts being unaccounted for by the City.
The Flnanoe Department should Issue a pronumbered receipt for all monies rec:elved. All City
employees who deposit monlet. with the Finance Department should reciuest a ns:elpt at 1t'ie time
that the monies are deposited.

A material weakness Is a reportable condition In whlc:h the design or operation of one or more of ttie speciflc:

Internal control structure elements does not reduce to a relatlvo!y low level the risk that etr0rs or
Irregularities In amounts that would be material In rolatlon to tno flnanclal statements being audited may
occur and not be detected wlttlln a timely l)eriod by employees In the normal course of performing their
assigned functions.
Our consideration of the lntomal oontrol structure woul~ not nacesaarlly dlSCIOao all mattonl In the Internal
control structure that might be reportablo conditions and, aocordlngly, would not necessatlly dlocloae all
reportablo conditions that are also conalderod to be matorlal waaknesr;es as defined above. However, we
noted tl'l8 following matter Involving the Internal control structure and Its operation that we conaidarto be a

material weakness as claflned above. Thii> condition was considered In determining the nature, timing, an
extent of the procedures to be performed In our audit of the flnanc:lal statements of tho City for the years
ended 0ec:emt)01' :3~. 1996 and 1995.

... ....

'

Material Woakne?s
The City rec:elvod many donations throughout tho year, Including cash donations for the purchase of a new
truck which was the prlzo In a ra111o held during Fun Fest. These donations wero not acknow1edged In the
minutes. This resultud in donations being accepted without the acknowledgment or City Council.
Donations should be acknowledged by Council and recorded In the City's record of l)l'OC8$Cllngs so that
Council can better monitor the use and disposition of donatlorn;. The minutes should reflect the donor, If not
anonymous, the amount. naturo and Intended use of tho donation. Tho mlnuttts should also reflect any
restrictions 'that the dot'lor has placed upon tho use or disposition of the donation.
We also noted cenaln other lnstancca of nonoomcllance and cenaln other matters Involving 1t1o internal
control structure that we have report9d to the management of the City In a separate letter elated Oc:tOb8r 6,
11)97,

This report Is Intended tor tho Information of management and Council. However, this report Is a ma1lel' Of
public record. and hs Clistrlbutlon 111 not limited.

"

...

:: ...... , :.

October 6, , 997

31

.. .., ..

::~;,.,

"

ST>o.TZ OP OH10
OPl'ICE OF THE Aut>ITOR

]IM PlmtO, AUDITOR OP STATit

1111.llMl- lllUlld ~
llolll 1140
Collln\b\Mo. Ohio 43216-1140

.o.

I'

T.i.pilOIW

61~'

l!00..282.o:rn>
PecaimlJ.

6.14""66-4490

Allport Of lnd9pendent: Accountllnt. on Compliance With tt. Gtnwal R9qull'9IMl'lts Afll)l!Qble to


Fler8t FIMncllll Anlstance Progt'llms

The Honorable Mayor and


Members of Council
City of Macedonia
Macedonia, Ohio

.. .

We have audttoel the 1tnanclal statomonta of tho City of Macodonia, Summit County, (trig City) as of and for
the years ended Oecember 31, 199e and 1995, and have lasuod ourl'Oj)Orttl'ler90n oated OctoberG, 1997
We have appllad procedures to test the City's compliance with the following reQutrements applicable to Its
1'XSet'a! financial aaaistance programs. which are idttntlfied In the Schedules of Federal Flnanc:lal Assistance,
for the years ended Oecember 31, 1996 and 1995.
Polltieal Ac11vity
Davis-Bacon Ad
Civil Rights
Cash Management
FOOeml Financial Repcrts
Allowable COstslCOSt Prtnelpies
Drug Freo Worlq)laoe Act
Our procedures went limited to the applical>le procedul'Gl.I deseribod In the Office of Management and
Budget's Compl!once SyPP!ement tor Slnafe Audits ot State and Local
Our procedures went
substantlalty less In scope than an audit. the objec:tlw or which Is the exprosslon or an opinion on the City's
compliance with the requirements Hstoel In the preceding paragraph. Ac:cordlngl'/, we do not e;iq:i~ss 11uc:h
an opinion.

owromeom .

Wlt.1-t respect to the Items tested, thO results of these procedures disclosed no material lnstanoos of
noncompliance wltl'l ttie requirements fisted in the second pamgraph ct this report. Wlth respectto Items
not tested, nothing came to our attention that caused us to believe that the City had not complied. In all
material respects, with those rec;iulrements.

HOWEIVQr, we noted certain lmmatorlal Instances of noncompliance and certain Immaterial matters lnvoMl"l'1
the Internal control strudlJre ttlat we have reported to the managament of the Clty In a separate lener da!od
October6, i9Q7,

la lntendl'>d for tho Information of managemont and Council. However, thii; NPOrt Is a matter of
public record and Its distribution Is no llmltacl.

Thq, report

October6, 1997

'

.:..

--
88 t-1 nro.d ~
Doi< 11..0 .
Colim~Ohlo "3216oU40

r.o.

ST.A'n! OP 0HJO
ORien OF THI? AUDITOR

T.!ephone

J?M Pln'JtO, AUOl'IOR OP STATE

61~4

80().l324J70
p~

61~90

Report of lntiependent Accountlinta on Compllenot with Spectftc Requlfementa Applk:llblm 10


Nonm9jor Federlil Flnanc:llll Aulstance Progrmn Tranwtlons

The 11onorabla Mayor and


Members of Council
City of Mecedonla
Macedonia, Ohio
Wo t1ave audited the 11nenclal sta~ments of ttio City of Macedonia. Summit County, (the Chy) aa of and for
the years ended Oecember31, 1996 and 1995, and havo lsauod our rOl)Ortthereon datod October6, 1997.

In connection with our audit of ttio financial statoments of the City and with our consideration of the City's
control structure usact to administer federal financial assistance programs, as requlrocl by O!flce of
Management and BUdget Circular A128, 8Ydl!3 ot State od l.ocal GMmmoms. we selectOO certain
transactions appllcable to certain nonmajor federal flnancl.sl asslstance prograills for tne years ondod
Deeember31, 1996and1995. As reciulrod by OMS Circular A128, wo have performed auditing
procedures to test compliance with the requlremonts govemlng types of services allowed or unallowed,
eligibility, and matching that aro applicable to thOoo transactions. Our procedures wore subntantlally leGS In
scope than an audit. the objective of which Is the exprosslon of an opinion on thO City's compliance with
these roQulroments, Accordingly, we do not oxpross such an opinion.

With rospect to the Items testod, tho results of thoso procoduros disclosed no matorial Instances of
noncompliance with the teQulrements llstod In tl'le preceding paragraph. With respect to Items not tested,
nothing came to our attention that ceUIJOd us to bollevo that tho City had not coml)lied, ln all monarial
ro51)ecis, with these requirements. However, the results of our procedures dlsclostld an Immaterial Instance
or noncompliance wl1h L>iose requlmments, which Is ~scribed below,
Scnedu!o of finding
The Chy did not maintain the required Community Oriented Policing Sorvlco (COPS) local matching share
records. Thi!> was an oversight on tho part of tne Cit/.

The COPS Grant Owners Manual, Section Ill, teQulres records of the local matching &hate to be mtdntalned
by the grantee. The records should clearly shew the source of tho matching funds, the amount of the
matching funds and when the matcl'll~ funds wero con!rlbutod. By not complying with the grant
agreement. tho City could potentially lose future federal financial assistance.
Howover we noted C011Dln lmmatorllll instRnces of noncompllaneo and COl'hlln Immaterial matters Involving
the Internal control strueturo that wo have ropcl'led to tho management of the Chy In a separate letter dated
October6, 1997.

This report ls Intended for the Information of man:igeme and CoiJncll. However, this report Is a matter o1
public record and its distribution Is
limited.

...."

"

October 6, 1997

33

...
...........,,., .

-~

..

M EMt llrcMd SU...t


P.O. BoK 1140

STA.Tl! OP OHIO
ChrPJCE OP nm AUDrroR.

::olwnbuo,Ohlo 43:16-1140:

]IM l'm:RO, AUDITOR 01' STAn!

Telo!phoM bl'"41i6-4.'Slo&

~-0310

P...c.lmJJcr 614-466-4490

Report of lnd9pendent AcWunt. on the lnhlmlll Contfol Struc:Wre UMd In Admlnlat.rlng F.-... .
FlMnc:llll Aalmnoe Psvgrama

The Honorable Mayor and


Membefa of Councll
City Of Macedonia
Macodonla, Ohio
We have audited tho financial statements of the City o1 Macedon!a, Summit County, (the City) as of and for
the years ended December 31. i 996 and i 995, and have lssuod our report thereon dated October 6, i 997.
We conducted our audits In .accordance with generally acceptod audltln;;i stanclarcl.<;; Govomment Aud!tlng
.StAQC!a!ds. Issued by the Comptroller General of the Un!PJd States: and
Of Management and Budget
Circular A-128, Audits ot State and LQ:ldll Govemments. Those standardS and OMS Circular A128 require
that we plan and pertorm the audl1S to obtain reasonable assurance about whether the ~nanclal :>tatements
aro 1roo Of material mlsstawmont

omoe

In planning and per1ormlng our audits for tho yoars onc:ed Oecomber 31. i 006 and 1005, wo consldemd ttie
lntornal control structu111 ot tno City ln Ot'dor to determine our auditing procedures for the pufl)OSO Of
e)Cpresalng our opinion on the City's financial statemonts and to report on the Internal control structure In
accordance with OMB Circular A12B. This report addresses our consideration Of Internal control structure
policies and procedures rolevant to compllanoe with requirements appUcable to fedeml financial assistance
programs. Wo heve addrosaed Internal control structure policies and procedures relevant to our audits or
!he financial statomonts In a separate report datod October 6, 1997.

'Tho management of the City l:s responsible tor ostabllchlng and maintaining an lntemal control structure. In

...
...
-

,,

fulfilling 1t11s rosponslblllty, estimaton and judgemonts by management aro roqulrod to ~a tho expected
benoflts and related costs of Internal control structure policies and procoduros. The objoctlves or an Internal
control structuro aro to prcvldo IT'anagomont with reasonablo, but not absoluto, assuranoo tnat assets aro
i;ateguarded against loss trom unauthorized use or disposition, that transac:tlons are executed In
accordance with management's authorization and rocorded properly to permit the preparation Of the
financial statoments In accordance with the cash basis of accounting, and that federal financial assistance
programs are managed in compliance with appllcablo laws and rogulatlons. Because of Inherent limitations
ln any Internal control structure, errors, irregularities, or Instances ot noncompliance may l'lellertheless occur
and not be detected. Also, projection of any evaluation of the structure to Munt pet1ods Is subject to the risk
that prooedures may become Inadequate because of changes In conditions or that the e1lectlvenesa of the
design and oporatlon Of polleles and procoduros may doterlorato.
For tho purposo Of 1tlls report. wo have claooified the slgnlflet\nt Internal control structure policies and
procedures used In admlnl::;terlng fodoral financial aulstance programs Into the following categories:

ACTIVITY CYCLES
lntetgovemrnontal Financial Assistance
Purcl'laslng
Payroll

City of Macedonia
Summit County
Report of Independent AccoUmants on the Internal Control Structure

Used In Administering Federal Financial Assistance Programs


Page2 .

OENERAL REQUIREMENTS
"

........
......

'

Pclltlcal Activity
Davi.Bacon Act

CMI Rlgnts
Cash Management
Federal Financial Reports
Allowable Costs/Cost Princlplea
Orug Free Workplace At:;t.

SPECIFIC REQUIREMENTS
Typos of Setvlces Allowed or Unuttowod
EllQibUlty
MalChlng
For all of the Internal control structure categories listed abOve, we obtained an understanding of 1he design
of relevant rx>licle3 and procedures and determined whether they have been plllced In operation, and we
assesaed control rl&k.
During the yoor ended December 3i, i 996 and i WS, the City had no major feoderal financial assistance
prosrams and expendecl SSo/. and 68%, respectively, of le total federal financial assistance unde:r ttie

Community Devolopmefi Block Grant.


We performed tests of controlc, as required by OMB Circular Ai2a. to evaluate ttle effectiveness of the
dsslgn and operaUon of lntomal control 8tn.lctU1'0 policies and procedums that wo have consldored relevant
to ;>roventlng or detecting material noncompliance with specltlc ro<;ulrements, general reQulrements, nd
roqulrumenta governing claims for advances and relmburMments that are apptlcable to the aforomentloned
nonmajor program. Our prococ:tures wero less Jn sc:ope than would l:le necessary to render an opinion on
these internal control structuro policies and procedure::. Accordlngly, wo do not oxpreS5 :;uch an e>plnion.
......

Oc.ir consldoratlon of the Internal control structuro policies and proeoduros used In administerlrY.1 federal
flnancldl assistance would not necessarily disclose All matters In tho lntomal control structure that mlgh:
constltlJl'.e material VJeaknesses undsr standards established by the American lnstltute of Certlfiod Public
AcCOuntants. A material woaknoss Is a condition In which 1he design or oporatlon of cme or more of the
lntemal control structure elements does not reduce to a relatively IOw level tho risk that noncompll2nce with
laws and '9Qulations that would bo materilll to a federlll financial assistance program may occur and not be
detsc:ted within n timely period by employees In the normal course of pertonnlng their assigned functions.
We noted no n'llltters Involving the Internal control strl.lcture and Its operations that we consider to bl!
material weaknesses as defined abOve.

However, we noted oertaln Immaterial lnstar.ces of noncompliance and certain Immaterial matter$ lnvoMng
the Internal control strudure that we have rvported to 1hG management of tho City In a separase tter cla1ed
OctObM ts, i997.

35

'

~~-~

........
,........

. ........
,..~

...

Cl~ of Macedonia
Summit County
Ret:ort of Independent Accountants on tt'le lntemal Control Structure
Uaed In Administering Federal Financial A!slStance Programs
Page3

Thia report Is Intended for the lnfonnatlon 01 management and Council. However, thlfl !'9POrt Is a matter of
public records, ttnd !ts distribution Is not limited.

October 6, 1997

........,....,,-

(,:
.,,,

..

36

STATE OP Omo
.
OPPic:E OP THn AUDITOR
JIM PBnO, AIJDl'IOlt OP STATE

MEMtem.dS-

P.O.Bott 1140

Colwmb....Ohlo 432lMl40.
Tlllep'- 61'M6/i-Ul4
~.cm
~

61+466-4490

.......
~

CITY OF MACEDONIA, SUMMIT COUNTY

CLERK'S CERTIFICATION
Thlo la 11 true and corNCt copy of lhe NPOrt which la required to be ftled In the Ofllce of the Auditor
of State purawint to SectJon 117..28, RevfMd ~ Md which Is ttled In Columbua. Ohio.

NOV
Date:._ _
_ _181997
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1111 r.- lll'Dtd s -

STA.Tl? OF OH10
OITICB OP THE AUDITOR

r.o. Dok 1140

Col~ Ohio

43216-1140

T~61~4

JIM I'E'rHO, AlJQlTOR 01" STATE

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6l~QO

The. Honorable Mayor and


Members of Council
City Of MaQOdon1a
MaC$C!Onla, OhlO 44056

In aocordance with Qovemment Auditing Staodar;Qs. we haw audltod the financial statements of the City

ot Macedonia, Summit county, (the City) a~ of and for the yoars ended December 31. 1996 and 1995,
and have lasuod our report thereon dated October 6, i 997.

Audltjno Stpodcirds also reQulre that we describe the scope ot our testlng or compliance
with laws and regulations and lnternlll controls and report any lrregularitlo!t, Illegal acts, other material
nonoompliance and reportable conditions In lntomal controls. We have lsti1uod reports dated Octobor 6,
19117 on compliance and tho Internal control structure reQulrod by Qavemment Aydltlna $tandaml as or

~moment

and 1or the years ended Oeoembor 31, 1996 and 1995.

In addition to tile matters we communicated to you In thO reports described aboYe, we are submitting for
your consideration the followlna comments on trio City's lntomal control structure and noncompllaneo
citations. These comments reflect mattors that. whllo In our opinion do not represent material Instances
of noncompllanc:e or reportable Internal control structuro cond1tlons. wo believe represent matters for
whlC'.1'1 lmprovemants In compllance or Internal controls or operational otfleleneles might be aehlovecl.
Due to the llml1ed nature of our audit. we have not fully assessed thoJ costblllnotlt relationship l'lf
Implementing the recommendations suggosted below. Howevor, these comments reflect our continuing
desire to a!Jalst your government. It you h11ve questlons or coneomt regarding tl'leso commoms. pleue
do not hesitate to contact us.
This, f91X>rt la Intended 1or the Information Of the COunell and management. Howovor, this repcrt Is a
public l'IK'Ord and Its distribution le not limited.

JIM PETRO
Auditor of State

Octclber 6, 1997

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City of MaOOdOnla
Report to Management
Page:Z

Cltatlons

1,

Ohkt Rev. Code Soctlon 124.38 stab.15 that employOOs shall fumlsh a wr1tten, signed statoment 10 dOCument the
use of sick leave.

Tho :reciulred written &18tements woro not always on f!lo.


2.

Ohio Rev. Code Soctlon 117.38 states that annual financial statement3 shall be flied with the Auditor of State
within nlntity days after the clOse of the fiscal year. Section 117.38 also provides that the chief fiscal oflieer shall
publish the annual report In ~ newspaper published In the polltlettl subdivision or taxing dlslrlct. This '8dion also
p~:ldes that any public lnstlMJon or taxing district whose flMnclal report was not flied at the time required by
this section shall pay 10 the Auelltor of State twenty-five dollars ($25) for each day the report Is not ft!ed attor the
filing date.

Thei-o was no Clocumenta1l0n that the City flied Ins calender year 1995 and 1996 annual financial statements with
ttle Auditor of State or published such statements.
3.

Ohio Revised Code Section 149.43 states that public documents shall bo mado available '/or inspection.
Tht'I <:lty did not maintain tho Utlllty Department records lndlCatlng 1he number of customers, 1tlCI monthly f9l)OrtS
of the Utility Department, or tne reglstratlon11 for soccer and ba:1ke1ball activities.

4.

OhlO Revi&OCI Code Section 149.39 states that the City records commisslon Is to meot once 8"8f'y six months,
and upon call of the chairman.
The City Records Commission did not meet In calender years 1996or1995.

5.

Ohio Rev. Cod~ Section 733.40 states that at1he first regular meeting of the !eglslatlve auttiorlty each month, the
meyor shaU submit a fi.111 statement of all money received by him.
The Mayor did not report 1tle Mayor's Court financial actMty to Council.

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City of ~ldonla
Report to Management

Page3

7.

Ohio Rev. Code Section 5705.39 statlJS 1hat tho total appropriat)on from each fund sNIL not exceed the total
Mttmat.d revenue of that fund. Appropr'btionnOxceedeC:l !1'18 amount certified as ava1iabie revenue by 1lle
. ~ commlaalon In the following funds:


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~ Sooc!a! 8IYJtnut Eund Typu: '


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P..,,,laaNe UcenM-T.x Fund
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.Fire ()peratk'Yo Levy Fund

.,,,:.: 1

,. .lm CWa! p!'9jeCt! fund Types:

State Route 82Wldenlng (Phase I) Fund


Brookpoint.Storm Waw lmpnMtment.S:und

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Recommm112!m
Various Fun Fest reeon1I were maintained by volunteef'S whll$.other Fun .Fest mcoros went maintained by the
.Part<a and Recreation Director. This resulted In the Fun Fest records bel~:clfflcult to locate.

Fun Feat record attould be maintained In a central lccatlon by tl'ltt peraon reGl)OnAible for tho activity.
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2.

'The~Cltycontracted with outak vendors 10 provide camlval-typo

rlCles for the Fun Feat. The 01.1alde vendors


used 1l'lelr own prenumbDfed tlekets and subsequently provided a list to the City of the 1:.'eglnnlng and ttndlng
numbers of the tlclcets.ao!Q and the amount Charged fQ!' 1he tic"'81s. Mathematicalerrors were dlacowred on the
1996.llstof ride proceeda-that.wu provided by the outside venc:or, and the ticket numbers were.not consecutive.
Alac1, the dally bGglMlng and ending tlCket numbers were not vorlfled by the Ctty. This could result In the City not
receMng the total monies due under me terms of the contract.
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'The. llatJng of tickets sold provided. by the outside YllndOr ahOuld.be recalculated by a City emp!Oyee. Al&o, the
beQ.mnlng and onctlng ticket numbers shOuld be verified dally by a City employee,
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Ave of me eight .xatnlned Fun Fest receipts wore not depOGlted In the bank within 24 houra. Thia could rnult In
tl'le IOs8 of lntel'8st revenue to lhe City.
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3.

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.Receipt$ aoould be deposited In the bank witnln 24 heurs. .

The. Income 1ax returns whlCh Indicated that a payment had been received from the taxplil.yer were not referenoed
to trie corresponcllng receipt or batch number. In ordet'io verity a payment tD the return, the hlltofy report had to
be ;itlntedandarecaJcutat!on wal'necesaary. Thia could allow errors In the recording of Income tax revenues to .
go c,;1ndetecled.
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lnordftr 10 allow the matching of Income tax.retums and .payments, the returns shouk:! Indicate a batchlreoolpt
nurr.lber. the amount of the payment, w!'N.lttler the payment was made by check or cash, and the dahl received.
5.

The' Finance. Oll'9CIOr hU yt'lt to submit at least tllxty-calenderyear :1995 Income tax flies to the City Law Oil-.c!or
for collec:tlon. This could teSUlt lnlost ~ue to the City.
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'fhe,Flnance Olrwctor &hoUld rwlew all delinquent Income tax flies at least qUMrtertyand promptly submit .them .to
the I.aw-Director for collection.

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City Of Mactldonla
Report to Managemont

Page6

f!geral BQ:COmmendanon

The City does not maintain a separate fund or cost ::enter for federal receipts and disbursements.
The Finance Dlrec:tol' should account for each federal crant In a separate fund or cost center ao that federal
transactions are ldenllflable on the City's ledgers.

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