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Fiscal Year 2010 MONROE COUNTY, FLORIDA SUPERVISOR OF ELECTIONS Special-Purpose Financial Statements For the Year Ended September 30, 2010 MONROE COUNTY, FLORIDA SUPERVISOR OF ELECTIONS For the Year Ended September 30, 2010 Special-Purpose Financial Statements, Required Supplementary Information and Independent Auditors' Reports Table of Contents Paqe Independent Auditors' Report ............................................................................................... 2 - 3 SPECIAL-PURPOSE FINANCIAL STATEMENTS Special-Purpose Balance Sheet— Governmental Funds------------------------------------------------ 4 Special-Purpose Statement of Revenues, Expenditures and Changes In Fund Balances - Governmental Funds 5 ------------------------------------------------------------------------ Notes to Special-Purpose Financial Statements------------------------------------------------------------- 6 - 11 REQUIRED SUPPLEMENTARY INFORMATION Schedule of Revenues and Expenditures - Budget and Actual - General Fund. 12 SUPPLEMENTARY INDEPENDENT AUDITORS' REPORTS Independent Auditors' Report on Internal Control over Financial Reporting and on Compliance and Other Matters Based on an Audit of Special-Purpose Financial Statements Performed In Accordance with Government Auditing Standards................................................ 13 - 14 Independent Auditors' Management Letter --------------------------------------------------------------------15 - 16 INDEPENDENT AUDITORS' REPORT To the Honorable Harry L. Sawyer, Jr., Supervisor of Elections of Monroe County, Florida: We have audited the accompanying special-purpose financial statements of each major fund and the aggregate remaining fund information of the Monroe County, Florida Supervisor of Elections (the "Supervisor of Elections") as of and for the year ended September 30, 2010, which collectively comprise the Supervisor of Elections special-purpose financial statements as listed in the table of contents. These special-purpose financial statements are the responsibility of the Supervisor of Elections' management. Our responsibility is to express opinions on these special-purpose financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards issued by the Comptroller General of the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the special-purpose financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the special- purpose financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall special- purpose financial statement presentation. We believe that our audit provides a reasonable basis for our opinions. As discussed in Note 1, the accompanying special-purpose financial statements were prepared for the purpose of complying with Section 218.39(2), Florida Statutes, and Chapter 10.550, Rules of the Auditor General-Local Governmental Entity Audits, and are not intended to be a complete presentation of the financial position and changes in financial position of the Supervisor of Elections. Additionally, the special-purpose financial statements present only the Supervisor of Elections and are not intended to present fairly the financial position and changes in financial position of Monroe County, Florida, taken as a whole. In our opinion, the special-purpose financial statements referred to above present fairly, in all material respects, the respective financial position of each major fund and the aggregate remaining fund information of the Monroe County, Florida Supervisor of Elections as of September 30, 2010, and the respective changes in financial position thereof for the year then ended in conformity with accounting principles generally accepted in the United States of America. 2 In accordance with Government Auditing Standards, we have also issued our report dated February 2, 2011 on our consideration of the Supervisor of Elections' internal control over financial reporting and our tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements and other matters. The purpose of that report is to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on the internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards and should be considered in assessing the results of our audit. The budgetary comparison schedule on page 12 is not a required part of the special-purpose financial statements but is supplementary information required by the Governmental Accounting Standards Board. We have applied certain limited procedures, which consisted primarily of inquiries of management regarding the methods of measurement and presentation of the required supplementary information. However, we did not audit the information and we express no opinion on it. This report is intended solely for the information and use of the Supervisor of Elections' management and the Florida Auditor General, and is not intended to be and should not be used by anyone other than these specified parties. CHERRY, BEKAERT& HOLLAND, L.L.P. • " "\A Orlando, Florida February 2, 2011 3 SPECIAL-PURPOSE FINANCIAL STATEMENTS MONROE COUNTY, FLORIDA SUPERVISOR OF ELECTIONS Special-Purpose Balance Sheet Governmental Funds September 30, 2010 Major Non-Major Fund Fund General Special Fund Revenue Totals ASSETS Assets Cash and cash equivalents $ 156,597 $ 17,692 $ 174,289 Prepaid expenses 11,901 - 11,901 Total assets $ 168,498 $ 17,692 $ 186,190 LIABILITIES AND FUND BALANCES Liabilities Accounts payable $ 62,718 $ - $ 62,718 Accrued wages and benefits payable 42,362 - 42,362 Due to Board of County Commissioners 63,418 - 63,418 Total liabilities 168,498 - 168,498 Fund balances - 17,692 17,692 Total liabilities and fund balances $ 168,498 $ 17,692 $ 186,190 See notes to special-purpose 4 financial statements. MONROE COUNTY, FLORIDA SUPERVISOR OF ELECTIONS Special-Purpose Statement of Revenues, Expenditures and Changes in Fund Balances Governmental Funds Year Ended September 30, 2010 Major Non-Major Fund Fund General Special Fund Revenue Totals Revenues Investment income $ 2,445 $ 11 $ 2,456 Miscellaneous 6,362 - 6,362 Total revenues 8,807 11 8,818 Expenditures Current: Personnel services 855,296 - 855,296 Operating expenditures 352,959 - 352,959 Capital outlay 25,650 - 25,650 Total expenditures 1,233,905 - 1,233,905 Excess of revenues over(under) expenditures (1,225,098) 11 (1,225,087) Other financing sources (uses) Transfer from Board of County Commissioners 1,288,515 - 1,288,515 Transfer to Board of County Commissioners (63,417) - (63,417) Total financing sources (uses) 1,225,098 - 1,225,098 Net change in fund balance - 11 11 Fund balance, beginning of year - 17,681 17,681 Fund balance, end of year $ - $ 17,692 $ 17,692 See notes to special-purpose 5 financial statements. MONROE COUNTY, FLORIDA SUPERVISOR OF ELECTIONS Notes to Special-Purpose Financial Statements Year Ended September 30, 2010 Note 1 —Summary of significant accounting policies Reporting entity — The Monroe County, Florida Supervisor of Elections (the "Supervisor of Elections") is a separately elected county official established pursuant to the Constitution of the State of Florida. The Supervisor of Elections' special-purpose financial statements do not purport to reflect the financial position or the results of operations of Monroe County, Florida (the "County") taken as a whole. Entity status for financial reporting purposes is governed by Statement No. 14, as amended by statement No. 39, of the Governmental Accounting Standards Board (GASB). Although the Supervisor of Elections' office is operationally autonomous, it does not hold sufficient corporate powers of its own to be considered a legally separate entity for financial reporting purposes. Therefore, the Supervisor of Elections is reported as part of the primary government of Monroe County, Florida. Description of funds — The accounting records are organized for reporting purposes on the basis of two governmental funds. Major Fund General Fund — The General Fund is a governmental fund used to account for all revenues and expenditures applicable to the general operations of the Supervisor of Elections that are not required legally or by accounting principles generally accepted in the United States of America to be accounted for in another fund. Non-Major Fund Special Revenue Fund—The Special Revenue Fund is used to account for the proceeds of specific revenue sources that are legally restricted or committed to expenditures for specific purposes. The Special Revenue Fund proceeds are to be used exclusively for the purchase of voting equipment, voter education, poll worker recruitment and training, federal election activities, and polling place accessibility. Measurement focus, basis of accounting, and financial statement presentation — The Supervisor of Elections' special-purpose financial statements are prepared for the purpose of complying with Section 218.39(2), Florida Statutes, and Chapter 10.550, Rules of the Auditor General-Local Governmental Entity Audits (the "Rules'), which require the Supervisor of Elections to only present fund financial statements. In conformity with the Rules, the Supervisor of Elections has not presented the government-wide financial statements, related disclosures or management's discussion or analysis, which are required to present a complete presentation of its financial position and changes in financial position. 6 MONROE COUNTY, FLORIDA SUPERVISOR OF ELECTIONS Notes to Special-Purpose Financial Statements Year Ended September 30, 2010 Note 1 —Summary of significant accounting policies (continued) Measurement focus, basis of accounting, and financial statement presentation (continued) The General Fund and the Special Revenue Fund are governmental funds which use the current financial resources measurement focus and the modified accrual basis of accounting. Revenues are recognized when measurable and available. Revenues are considered to be available when they are collectible within the current period or soon enough thereafter to pay liabilities of the current period. For this purpose, the Supervisor of Elections considers amounts collected on grants within 60 days after year-end, and amounts collected on all other government funds within 60 days after year-end, to be available and thus recognizes them as revenues of the current year. Expenditures generally are recorded when a liability is incurred, as under accrual accounting. However, expenditures related to compensated absences and claims and judgments are recorded only when payment is due. The extent to which General Fund revenues exceed General Fund expenditures is reflected as transfers out and as liabilities to the Monroe County Board of County Commissioners. Budgetary requirements — General Fund expenditures are controlled by appropriations in accordance with the budget requirements set forth in the Florida Statutes. The General Fund budget is prepared on a basis consistent with accounting principles generally accepted in the United States of America. The Special Revenue Fund does not have a legally adopted budget. Cash and cash equivalents — The Supervisor of Elections' cash and cash equivalents consist of demand deposits. Capital assets—Tangible personal property used in the Supervisor of Elections' operations are recorded as expenditures in the General Fund at the time assets are received and a liability is incurred. Purchased assets are capitalized at historical cost in the government-wide financial statements of the County. In addition, the County provides office space used by the Supervisor of Elections at no charge. Compensated absences — The Supervisor of Elections permits employees to accumulate earned but unused vacation and sick pay benefits. The Supervisor of Elections is not legally required to and does not accumulate expendable available financial resources to liquidate this obligation. The obligation for compensated absences is accrued in the government wide financial statements of the County. Related long-term obligations, amounting to $73,829 at September 30, 2010, are included in the government-wide financial statements of the County. Use of estimates - The preparation of special-purpose financial statements requires management to make use of estimates that affect reported amounts. Actual results could differ from estimates. Note 2— Deposits and investments At September 30, 2010, the Supervisor of Elections has demand deposits with a carrying amount of$174,289 and a bank balance of$154,734. 7 MONROE COUNTY, FLORIDA SUPERVISOR OF ELECTIONS Notes to Special-Purpose Financial Statements Year Ended September 30, 2010 Note 2— Deposits and Investments (continued) The Supervisor of Elections places its cash and cash equivalents on deposit with financial institutions in the United States. The Federal Deposit Insurance Corporation (FDIC) covers $250,000 for substantially all depository accounts. The Supervisor of Elections from time to time may have amounts on deposit in excess of the insured limits and the remaining balances are insured 100% by the State of Florida collateral pool, a multiple financial institution pool with the ability to assess its members for collateral shortfalls if a member institution fails. Florida Statutes and the Supervisor of Elections' investment policy authorize investments in certificates of deposit, savings accounts, repurchase agreements, the Local Government Surplus Funds Trust Fund administered by the Florida State Board of Administration, money market funds, and direct obligations of the U.S. Treasury and federal agencies and instrumentalities. Prepaid Items — The cost of prepaid items is recorded as an expenditure at the time it is acquired, which is in accordance with the purchase method. Note 3— Retirement system Plan description — The Supervisor of Elections' employees participate in the Florida Retirement System ("FRS"), administered by the Florida Department of Administration. Employees elect participation in either the defined benefit plan ("Pension Plan"), a cost sharing, multiple-employer, defined benefit retirement plan, or the defined contribution plan ("Investment Plan") under the FRS. As a general rule, membership in the FRS is compulsory for all employees working in a regularly established position for a state agency, county government, district school board, state university, community college, or a participating city or special district within the State of Florida. The FRS provides retirement and disability benefits, annual cost-of- living adjustments, and death benefits to Plan members and beneficiaries. Benefits are established by Chapter 121, Florida Statutes, and Chapter 60S, Florida Administrative Code. Amendments to the law can be made only by an act of the Florida Legislature. 8 MONROE COUNTY, FLORIDA SUPERVISOR OF ELECTIONS Notes to Special-Purpose Financial Statements Year Ended September 30, 2010 Note 3— Retirement system (continued) Benefits are computed on the basis of age, average final compensation, and service credit. Regular class employees who retire at or after age 62 with 6 years of credited service or 30 years of service regardless of age are entitled to a retirement benefit payable monthly for life, equal to 1.6% of their final average compensation for each year of credited service. Vested employees with less than 30 years of service may retire before age 62 and receive reduced retirement benefits. Special risk class employees (sworn law enforcement officers, firefighters, and correctional officers) who retire at or after age 55 with 6 years of credited service, or with 25 years of service regardless of age, are entitled to a retirement benefit payable monthly for life equal to 3.0% of their final average compensation for each year of credited service. Senior Management Service class employees who retire at or after age 62 with at least 6 years of credited service or 30 years of service regardless of age are entitled to a retirement benefit payable monthly for life, equal to 2.0% of their final average compensation for each year of credited service. Elected Officers' class employees who retire at or after age 62 with at least 6 years of credited service or 30 years of service regardless of age are entitled to a retirement benefit payable monthly for life, equal to 3.0% (3.33% for judges and justices) of their final average compensation for each year of credited service. A post-employment health insurance subsidy is also provided to eligible retired employees through the FRS in accordance with Florida Statutes. In addition to the above benefits, the FRS administers a Deferred Retirement Option Program ("DROP"). This program allows eligible employees to defer receipt of monthly retirement benefit payments while continuing employment with a Florida Retirement System employer for a period not to exceed 60 months after electing to participate. Deferred monthly benefits are held in the Florida Retirement System Trust Fund and accrue interest. For those employees electing participation in the Investment Plan rather than the Pension Plan, vesting occurs at one year of service. These participants receive a contribution for self-direction in an investment product with a third party administrator selected by the State Board of Administration. The State of Florida annually issues a publicly available financial report that includes financial statements and required supplementary information for the FRS. The latest available report may be obtained by writing to the State of Florida Division of Retirement, Department of Management Services, P.O. Box 9000, Tallahassee, FL 32315-9000, or accessing their internet site at www.frs.state.fl.us. 9 MONROE COUNTY, FLORIDA SUPERVISOR OF ELECTIONS Notes to Special-Purpose Financial Statements Year Ended September 30, 2010 Note 3— Retirement system (continued) Funding Policy — The FRS is noncontributory for members. Governmental employers are required to make contributions to the FRS based on statewide contribution rates. The contribution rates by job class through June 30, 2010 were as follows: regular 9.85%; special risk 20.92%; special risk administrative support 12.55%; county elected officers 16.53%; senior management 13.12% and DROP participants 10.91%. Effective July 1, 2010 the contribution rates by job class were as follows: regular, 10.77%; special risk, 23.25%; special risk administrative support, 13.24%; county elected officers, 18.64%; senior management, 14.57%; and DROP participants, 12.25%. During the fiscal year ended September 30, 2010, the Supervisor of Elections contributed to the plan an amount equal to 12.01% of covered payroll. Supervisor of Elections' contributions to the FRS for the fiscal years ending September 30, 2008 through 2010 were $69,612, $74,107 and $78,182, respectively, which were equal to the required contributions for each fiscal year. The Supervisor of Elections has historically contributed amounts equal to required contributions and, therefore, does not have a pension asset or liability as determined in accordance with GASB Statement No. 27. Note 4—Other Postemployment Benefits (OPEB) Plan The Monroe County Board of County Commissioners (BOCC) administers a single-employer defined benefits healthcare plan (the "Plan"). Florida Statutes 112.0801 requires the County to provide retirees and their eligible dependents with the option to participate in the Plan if the County provides health insurance to its active employees and their eligible dependents. The Plan provides medical coverage and prescription drug benefits to both active and eligible retired employees. The Plan does not issue a publicly available financial report. The BOCC may amend the plan design, with changes to the benefits, premiums and/or levels of participant contribution at any time. In an open session, on at least an annual basis and prior to the annual enrollment process, the BOCC approves the rates for the coming calendar year for the retiree and County contributions. Eligibility for post employment participation in the Plan is limited to full time employees of the County, and the Constitutional Officers. Employees who retire as an active participant in the Plan and were hired on or after October 1, 2001 may continue to participate in the Plan by paying the monthly premium established annually by the BOCC. Employees who retire as an active participant in the plan, were hired before October 1, 2001, have at least ten years of full time service with the County, and meet the retirement criteria of the Florida Retirement System (FRS) may continue to participate in the Plan at a cost equal to the FRS Health Insurance Subsidy for ten years of service (currently $5 per month for each year of service credit at retirement or $50 per month). Retirees who have met the requirements for early retirement, have not achieved age 60 and whose age and years of service do not equal 70 (rule of 70) must pay the standard monthly premium until the age criteria or the rule of 70 is met. At that time, the retiree's cost of participation will be equal to the FRS Health Insurance Subsidy. Surviving spouses and dependents of participating retirees may continue in the plan if eligibility criteria specific to those classes are met. 10 MONROE COUNTY, FLORIDA SUPERVISOR OF ELECTIONS Notes to Special-Purpose Financial Statements Year Ended September 30, 2010 Note 4—Other Postemployment Benefits (OPEB) Plan (continued) The BOCC engages an actuarial firm on a biannual basis to determine the County's actuarially determined annual required contribution and unfunded obligation. The Supervisor of Elections has no responsibility to the Plan other than to make the periodic payments determined by the BOCC. Further information about the Plan is available in the County's Comprehensive Annual Financial Report which is published on the Clerk's website at www. clerk-of-the-court.com. Note 5— Risk management The Supervisor of Elections is exposed to various risks of loss related to tort; theft of, damage to, and destruction of assets; errors and omissions; injuries to employees; and natural disasters. The Supervisor of Elections participates in the coverage provided by the Board for Workers' Compensation, Group Insurance, and Risk Management internal service funds. Under these programs, Workers' Compensation provides $1,000,000 coverage per claim for regular employees. Risk Management has a $5,000,000 excess insurance policy for general liability claims with a $100,000 self-insured retention, and building property damage is covered for the actual value of the buildings with a deductible between $100,000 and $250,000. Deductibles for windstorm and flood vary by location. Monroe County purchases commercial insurance for claims in excess of coverage provided by the funds and for all other risks of loss. Settled claims have not exceeded this commercial coverage in any of the past three years. The Supervisor of Elections makes payments to the Workers' Compensation, Group Insurance and Risk Management Funds based on estimates of the amounts needed to pay prior and current year claims. Note 6— Litigation The Supervisor of Elections is a party from time to time in various lawsuits and other claims incidental to the ordinary course of its operation, some of which are covered by the Board's self- insurance program. While the results of litigation cannot be predicted with certainty, management believes the final outcome of such litigation will not have a material adverse effect on the Supervisor of Elections' financial position. 11 REQUIRED SUPPLEMENTARY INFORMATION MONROE COUNTY, FLORIDA SUPERVISOR OF ELECTIONS Schedule of Revenues and Expenditures Budget and Actual -General Fund Year Ended September 30, 2010 General Fund Variance with Final Budget Original Final Positive Budget Budget Actual (Negative) Revenues Investment income $ - $ - $ 2,445 $ 2,445 Miscellaneous - - 6,362 6,362 Total revenues - - 8,807 8,807 Expenditures Current: Personnel services 826,015 826,015 855,296 (29,281) Operating expenditures 402,500 402,500 352,959 49,541 Capital outlay 60,000 140,000 25,650 114,350 Total expenditures 1,288,515 1,368,515 1,233,905 134,610 Excess of revenues over(under) expenditures (1,288,515) (1,368,515) (1,225,098) 143,417 Other financing sources (uses) Transfer from Board of County Commissioners 1,288,515 1,368,515 1,288,515 (80,000) Transfer to Board of County Commissioners - - (63,417) (63,417) Total financing sources (uses) 1,288,515 1,368,515 1,225,098 (143,417) Excess of revenues over expenditures and other financing sources (uses) - - - - Fund balance, beginning of year - - - - Fund balance,end of year $ - $ - $ - $ - 12 SUPPLEMENTARY INDEPENDENT AUDITORS' REPORTS INDEPENDENT AUDITORS' REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING AND ON COMPLIANCE AND OTHER MATTERS BASED ON AN AUDIT OF SPECIAL-PURPOSE FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS To the Honorable Harry L. Sawyer, Jr., Supervisor of Elections of Monroe County, Florida: We have audited the special-purpose financial statements of each major fund of Monroe County, Florida Supervisor of Elections (the "Supervisor of Elections") as of and for the year ended September 30, 2010, which collectively comprise the Supervisor of Elections' special- purpose financial statements, and have issued our report thereon dated February 2, 2011 for the purpose of compliance with Section 218.29(2), Florida Statutes, and Chapter 10.550, Rules of the Auditor General-Local Governmental Entity Audits. We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Internal Control over Financial Reporting In planning and performing our audit, we considered the Supervisor of Elections' internal control over financial reporting as a basis for designing our auditing procedures for the purpose of expressing our opinion on the special-purpose financial statements, but not for the purpose of expressing an opinion on the effectiveness of the Supervisor of Elections' internal control over financial reporting. Accordingly, we do not express an opinion on the effectiveness of the Supervisor of Elections' internal control over financial reporting. A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct misstatements on a timely basis. A material weakness is a deficiency, or a combination of deficiencies, in internal control such that there is a reasonable possibility that a material misstatement of the Supervisor of Elections' special-purpose financial statements will not be prevented, or detected and corrected on a timely basis. Our consideration of internal control over financial reporting was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control over financial reporting that might be deficiencies, significant deficiencies, or material weaknesses. We did not identify any deficiencies in internal control over financial reporting that we consider to be material weaknesses, as defined above. 13 Compliance and Other Matters As part of obtaining reasonable assurance about whether the Supervisor of Elections' special- purpose financial statements are free of material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts and grant agreements, noncompliance with which could have a direct and material effect on the determination of special-purpose financial statement amounts. However, providing an opinion on compliance with those provisions was not an objective of our audit and accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance or other matters that are required to be reported under Government Auditing Standards. This report is intended solely for the information and use of the Supervisor of Elections' management and the Florida Auditor General, and is not intended to be and should not be used by anyone other than these specified parties. CHERRY, BEKAERT& HOLLAND, L.L.P. • " \A Orlando, Florida February 2, 2011 14 INDEPENDENT AUDITORS' MANAGEMENT LETTER To the Honorable Harry L. Sawyer, Jr., Supervisor of Elections of Monroe County, Florida: We have audited the special-purpose financial statements of each major fund of the Monroe County, Florida Supervisor of Elections (the "Supervisor of Elections"), as of and for the year ended September 30, 2010, and have issued our report thereon dated February 2, 2011. We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. We have issued our Independent Auditors' Report on Internal Control over Financial Reporting and on Compliance and Other Matters Based on an Audit of Special-Purpose Financial Statements Performed in Accordance with Government Auditing Standards. Disclosures in this report, which is dated February 2, 2011, should be considered in conjunction with this management letter. Additionally, our audit was conducted in accordance with Chapter 10.550, Rules of the Auditor General-Local Governmental Entity Audits, which govern the conduct of local governmental entity audits performed in the State of Florida. This letter includes the following information, which is not included in the aforementioned auditors' reports. Section 10.554(1)(i)l., Rules of the Auditor General, requires that we determine whether or not corrective actions have been taken to address findings and recommendations made in the preceding annual financial audit report. No recommendations were made in the preceding annual financial audit report. Section 10.554(1)(i)2., Rules of the Auditor General, requires our audit to include a review of the provisions of Section 218.415, Florida Statutes, regarding the investment of public funds. In connection with our audit of the special-purpose financial statements of the Supervisor of Elections, nothing came to our attention that would cause us to believe that the Supervisor of Elections was in noncompliance with Section 218.415 regarding the investment of public funds. Section 10.554(1)(i)3., Rules of the Auditor General, requires that we address in the management letter any recommendations to improve financial management. In connection with our audit, we did not have any such recommendations. Section 10.554(1)(i)4., Rules of the Auditor General, requires that we address violations of provisions of contracts or grant agreements, or abuse, that have occurred, or are likely to have occurred, that have an effect on the special-purpose financial statements that is less than material but more than inconsequential. In connection with our audit, we did not have any such findings. 15 Section 10.554(1)(i)5., Rules of the Auditor General, provides that the auditor may, based on professional judgment, report the following matters that have an inconsequential effect on special-purpose financial statements, considering both quantitative and qualitative factors: (1) violations of provisions of contracts or grant agreements, fraud, illegal acts, or abuse, and (2) control deficiencies that are not significant deficiencies. In connection with our audit, we did not have any such findings. Section 10.554(1)(i)6., Rules of the Auditor General, requires that the name or official title and legal authority for the primary government and each component unit of the reporting entity be disclosed in the management letter, unless disclosed in the notes to the special-purpose financial statements. The Supervisor of Elections is a separately elected county official established pursuant to the Constitution of the State of Florida. There are no component units related to the Supervisor of Elections. Pursuant to Chapter 119, Florida Statutes, this management letter is a public record and its distribution is not limited. Auditing standards generally accepted in the United States of America requires us to indicate that this letter is intended solely for the information and use of the Supervisor of Elections' management and the Florida Auditor General, and is not intended to be and should not be used by anyone other than these specified parties. CHERRY, BEKAERT& HOLLAND, L.L.P. • " `\A Orlando, Florida February 2, 2011 16