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M M M
ORDINANCE NO. 15,733
AN ORDINANCE REQUIRING COMPLIANCE WITH CITY FISCAL
POLICIES BY ORGANIZATIONS RECEIVING SUBSIDY, GRANT,
OR LOAN FUNDING FROM THE CITY OF LITTLE ROCK, OR USING
THE CITY'S NAME FOR BOND FINANCING.
WHEREAS, concerns have been expressed by the Board of
Directors regarding the financial condition of organizations which
receive subsidy, grant, loan funding, or bond financing through
use of the City's name which may not be readily apparent from a
review of their respective annual reports; and
WHEREAS, it is the desire of the Board of Directors to
standardize the process of this review.
NOW, THEREFORE, BE IT ORDAINED BY THE BOARD OF DIRECTORS OF
THE CITY OF LITTLE ROCK, ARKANSAS:
SECTION 1: GENERAL APPLICABILITY:
A. These policies shall pertain to Authorities, Agencies,
Commissions, and Boards created under the auspices of the City of
Little Rock Board of Directors which receive City funds in the
form of subsidies, grants, or loans.
B. The fiscal policies shall also apply to organizations
other than those identified in "A" which receive subsidy, grant or
loan funding from the City of Little Rock. Provided, however, such
organizations need only apply the policies to specific fund
amounts provided by the City if said amounts are separately
accounted for, audited, and held on deposit.
C. Any organization whatsoever wishing to borrow funds
through the use of debt instruments bearing the name of the City
of Little Rock shall comply with Section 5 -C hereof.
D. organizations covered by these policies are herein
referred to as a "Covered Entities."
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SECTION 2: RESPONSIBILITY FOR COMPLIANCE:
A. Responsibility for compliance with these policies lies
with the Covered Entity, and related costs will be borne by the
Covered Entity.
B. Tests for compliance are to be included in an annual
audit by a certified public accountant, and a statement relative
to compliance shall be included in the Annual Financial Report
provided provided to the City Manager whithin 90 days of the
organization's fiscal year end.
C. Subsequent to review by the City Manager or his
designee, the report is to be filed with the City Clerk.
D. Failure to comply with this policy will serve as the
City Manager's authority to cease payment of City funds to the
Covered Entity.
SECTION 3: FINANCIAL OPERATIONS:
A. Purchasing
1. Each Covered Entity shall be responsible for
executing its own purchase transactions. It shall, however,
use the latest edition of the City of Little Rock Purchasing
Manual as a procedural guide. Strict compliance with City
purchasing policies and procedures shall be at the option of the
Covered Entity.
2. Covered Entities shall.have access to City of Little
Rock Purchasing Division bid information. Vendors will be
encouraged to extend the City's pricing to Covered Entities where
doing so will not increase the cost to the City.
B. Accounts Payable
1. All vendor invoices, except those for which
documentation indicates vendors know are being disputed, are to be
paid within 30 days of receipt. Failure of the organization to
comply with this provision shall be brought to the attention of
the City Manager in writing within 40 days of invoice receipt.
C. Payroll
1. The Covered Entity shall establish a list of employee
pay dates prior to the beginning of each fiscal year. Payments to
employees are to be made in accordance with this schedule.
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2. All withholdings from employees, and the employer's
portion of payroll taxes, insurance premiums, and other related
costs shall be paid to the respective beneficiary by the date
stipulated by law or agreed agreed to by contract with the
beneficiary.
3. Any failure to comply with this section shall be
made known to the City Manager in writing within ten days after a
payment due date.
D. Cash Handling
1. Internal control procedures over cash shall be
documented, and include separation of duties and monthly
reconciliations of cash accounts to to bank balances. Bank and
impress (petty cash) reconciliations shall be completed within 15
days of each month end.
E. Asset Inventory
1. Operating inventories shall be subject to an annual
audit and reconciliation to the organization's records. Material
shortages shall shall be investigated and explained.
2. Fixed assets having a life expectancy greater than
one year, and unit value in excess of $300 shall be itemized in
the organization's records and subjected to annual audit. The
records shall reflect the reasons for all eliminations or
transfers.
SECTION 4: ANNUAL BUDGET
A. Every Covered Entity must prepare an annual budget for
its operations, which must be affirmed budget for its operations,
which must be affirmed and adopted by its governing board or
commission prior to the beginning of the applicable fiscal year.
B. The annual financial report required by Section 6 -B
will include a comparison of actual results to budget as
supplemental information.
SECTION 5: DEBT MANAGEMENT (BORROWING)
A. All short and long -term borrowings of the organization
are to be paid as agreed. Failure to comply with this provision
shall be brought to the attention of the City Manager in writing
within ten days after the due date.
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1 B. Funding from the City of Little Rock is not to be
2 pledged as collateral for short or long -term debt without prior
3 written approval of the City Manager.
4 C. No borrowing, including bond issues, shall be undertaken
5 in the City of Little Rock's name without the City Manager's
6 review of an independently prepared feasibility analysis. A
7 recommendation based on this analysis will then be provided to the
8 City Board of Directors.
9 SECTION 6: ANNUAL INDEPENDENT AUDIT
10 A. All funds covered by this fiscal policy shall be audited
11 annually by a firm of certified public accountants. Examinations
12 shall be made in accordance with generally accepted auditing
13 standards, and shall include such tests of accounting records and
14 internal procedures as the independent auditor considers necessary
15 in the circumstances.
16 B. An Annual Financial Report shall be prepared and
17 submitted to the City of Little Rock. This report shall contain
18 the written opinion of the independent auditors regarding the
19 fairness of the financial position presented by Balance Sheet,
20 Statement of Revenues and Expenditures, and Statement of Changes
21 in Financial Position contained in the report, and the
22 organization's conformity with generally accepted accounting
23 principles applied on a basis consistent with that of the
24 preceding year. The report shall also include an independent
25 auditor's statement relative to substantial compliance with this
26 City's policy.
27 SECTION 7: INTERIM FINANCIAL REPORTS
28 A. Unaudited monthly financial reports on the Covered
29 Entities operations shall be submitted to the City Manager within
30 30 days of the end of a calendar quarter. These shall include in
31 generally accepted form:
32 1. Income Statement
33 2. Statement of Financial Position (Balance Sheet)
34 3. Comparison of actual revenue and expense versus
35 Budget for the current period and year -to- date..
36 B. Each interim report shall contain a statement signed by
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the covered entity's Chief Executive officer and Governing Body
Chairperson attesting to compliance with these policies.
SECTION 8: This ordinance shall take effect commencing
with the Covered Entity's fiscal year beginning on or after
October 1, 1989.
PASSED: August 15, 1989
ATTEST:
On A4
CI CLERK JA E CZECH
, CITY ATTORNEY
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APPROVED:
I W—/� &��
VICE MAYOR SHARON PRIEST