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<br />84
<br />
<br />TUESDAY
<br />
<br />NOVEMBER 9, 1976
<br />
<br />4. The change will eliminate most of the problems of existing
<br />cash over-drafts which the Auditors have commented on.
<br />
<br />I refer you to the 1975 Auditor's Report for the City written by
<br />Ford, Hogg and Cobbe:
<br />
<br />"Various statements of financial condition disclose cash
<br />over-drafts at June 30, 1975. Cash from the various
<br />funds are co-mingled in order to aid in the administration
<br />of total cash flow. However, over-drafts in various funds
<br />defeat the purpose of co-mingling the actual cash, since
<br />they represent cash transfers or loans to the overdrawn
<br />funds. We recommend that existing over-drafts be eliminated
<br />when funds are available and that a policy of avoiding over-
<br />drafts be adopted."
<br />
<br />The new system will eliminate the problem of existing cash over-drafts,
<br />except for Central Stores, and because only eight funds will remain, it
<br />should be easier to avoid future over-drafts.
<br />
<br />5. The change will eliminate long standing deficits and/or
<br />surpluses of the individual funds without the necessity of action
<br />by Council on a periodic basis.
<br />
<br />An example is Mr. Yeaman's suggestion to Council on May 14th to
<br />merge two funds into the General Fund in order to eliminate long-
<br />standing individual fund deficits.
<br />
<br />6. Finally, accounting for eight funds instead of eighteen
<br />funds is less expensive and time-consuming.
<br />
<br />Obviously, bookkeeping, posting, and time spent balancing funds will
<br />be shortened for Mr. Yeaman's department. In addition, Steve
<br />Kendrick of Ford, Hogg and Cobbe estimates that the size of the audit
<br />report will be reduced.
<br />
<br />I have discussed these changes with Mr. Kendrick, Auditor, Ford, Hogg
<br />and Cobb, and with Mr. Yeaman. Both Mr. Kendrick and Mr. Yeaman agree
<br />with my reasoning.
<br />
<br />I hope that Council will act favorable on my suggestions barring any
<br />legal prohibitions, and subject to any further findings by Mr. Yeaman,
<br />and that the suggestions will be implemented as soon as possible.
<br />
<br />Mr. Thomas J. Womack, referring to Council's consideration of a proposed charter
<br />
<br />amendment hereinbefore recorded in these minutes, expressed concern over his
<br />
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