Comprehensive Annual Financial Report (CAFR) - Johnson City

CITY OF JOHNSON CITY, TENNESSEESCHEDULE OF FINDINGS AND QUESTIONED COSTSJune 30, 2011Section II- Financial Statement Findings (continued)Current Year Findings (continued):11-04 Significant Deficiency: Premiums and Fees Charged to Funds for Insurance.·Condition: Health insurance premiums charged to the individual funds were substantially different thanthe amounts that would have been charged based on participation. It was also noted that the Schools didnot allocate an appropriate amount for Worker's Compensation.Criteria: Employer health insurance contributions made by the City and the Schools should be made inamounts that are based on actual employee participation by department. The School should budget andallocate appropriately for Worker's Compensation.Effect: Certain funds bear a disproportionate share of th~ burden for health insurance and workerscompensation insurance.Recommendation: The processes for charging health insurance premiums should be reviewed and thepremiums collected from the individual funds should be compared with actual participation and potentiallyadjusted to reflect the actual participation. The Schools should budget and transfer amounts for workerscompensation in accordance with guidance from risk management.Management Comments: Management will review the budget process for the employer share of healthinsurance premiums and adjust the budget to reflect actual participation. Management will communicatewith the school the need to budget and transfer amounts for workers compensation in accordance withguidance from risk management.Prior Year Findings Implemented:JO.:.OJ Significant Deficiency: Police RecordsSection ill - Federal Award Findings and Questioned CostsThere were no fmdings in regard to the major federal award programs audit.213