Fiscal Year 2013-2015 Special Budget Meeting

CITY OF OAKLAND Required Communications and Recommendations Fiscal Year folded June 30,2009 REQUIRED COMMUNICATIONS (Continued) • Estimated allowance for losses on loans receivable. The allowance for losses on loans receivable was based on the types of loan (e.g.. forgivable, deferred, grant or amortizing) aiul man^ement's ^tunate regarding the l&elihood of collectibility based on loan provisions and collateral. Useful life estimates for capital assets. The estimated usefiil lives of coital assets were based on management's estimate of the economic life of the assets. - Valuation of the net pension asset. Hie net pension asset is the amount tiiat exceeded tiie City's actuarially determined annual required contribution, which Is based upon certain approved actuaxial assumptions. This amount is then amortized ov^ the amortization period used by the actuary to recognize the excess ccmtribution as pension costs over time. " Estimated claims liabilities. Reserves for estimated claims liabilities were based on actuarial evaluations using historical loss, other data and attomey judgmrat about the ultimate outoome of the claims. • Annual required contributions to pension and other postemployment benefit plans. The City is required to contribute to its pension plans at an actuarially determined rate and to measure other postemployment benefit costs based upon certain i^roved actuarial assumptions. We evaluated the key factors and assumptions used to develop these accounting estimates in determining that they are reasonable in relation to tiie financial reporting units that collectively comprise the City's basic financial statements. D^icuitiea Encountered In Performing the Audit We ^icoimtered no significant difRculties m dealing with management in performing and completing our audit. Corrected and Uttcorrected Misstatements Professional standards require us to accumulate all known and likely misstatements identified during the audit other than those that are trivial, and communicate them to the ^pn^riale level of management Management has corrected all such misstatements- In addition, none of the misstatfflnents detected as a result of audit procedures and corrected by management were material, cittier individually or in the aggregate, to each opinion unit's financial statements taken as a whole. Disagreements with Management For purposes of this letter, professional standards define a disagreement with management as a financial accounting, reporting, or auditing matter, whether or not resolved to our satisfaction, tiiat could be significant to the financial statements or tiie auditor's report We are pleased to report that no such disagreements arose during the course of our audit. Management JS^reseniatiottS We have requested certain representations &om management that are included in the management representation letter dated November 25,2009.