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McClanahan and Holmes, LLP
<br />CERTIFIED PUBLIC ACCOUNTANTS
<br />R. E. BOSTWICK, CPA
<br />STEVEN W.MOHUNDRO,CPA
<br />GEORGE H. STRUVE, CPA
<br />ANDREW B. REICH, CPA
<br />RUSSELL P. WOOD, CPA
<br />DEBRA J. WILDER, CPA
<br />228 SIXTH STREET S.E.
<br />PARIS, TEXAS 75460
<br />903-784-4316
<br />FAX 903-784-4310
<br />304 WEST CHESTNUT
<br />DENISON, TEXAS 75020
<br />903-465-6070
<br />FAX 903-465-6093
<br />1400 WEST RUSSELL
<br />BONHAM, TEXAS 75418
<br />903-583-5574
<br />Report on Internal Control Over Financial Reporting and on FAX 903-583-9453
<br />Compliance and Other Matters Based on an Audit of Financial Statements
<br />Performed in Accordance with Government Auditing Standards
<br />Honorable Mayor and City Council
<br />City of Paris, Texas
<br />We have audited the financial statements of the governmental activities, the business-type activities, the aggregate
<br />discretely presented component units, each major fund, and the aggregate remaining fund information of the City of
<br />Paris, Texas, as of and for the year ended September 30, 2011, which collectively comprise the City of Paris, Texas',
<br />basic financial statements and have issued our report thereon dated March 29, 2012. We conducted our audit in
<br />accordance with auditing standards generally accepted in the United States of America and the standards applicable to
<br />financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States.
<br />Internal Control Over Financial Reporting
<br />In planning and performing our audit, we considered the City of Paris, Texas', internal control over financial reporting as
<br />a basis for designing our auditing procedures for the purpose of expressing our opinions on the financial statements, but
<br />not for the purpose of expressing an opinion on the effectiveness of the City of Paris, Texas', internal control over
<br />financial reporting. Accordingly, we do not express an opinion on the effectiveness of the City of Paris, Texas', internal
<br />control over financial reporting.
<br />A control deficiency exists when the design or operation of a control does not allow management or employees, in the
<br />normal course of performing their assigned functions, to prevent or detect misstatements on a timely basis. A significant
<br />deficiency is a control deficiency, or combination of control deficiencies, that adversely affects the City of Paris, Texas',
<br />ability to initiate, authorize, record, process, or report financial data reliably in accordance with generally accepted
<br />accounting principles such that there is more than a remote likelihood that a misstatement of the City of Paris, Texas',
<br />financial statements that is more than inconsequential will not be prevented or detected by the City of Paris, Texas',
<br />internal control.
<br />A material weakness is a significant deficiency, or combination of significant deficiencies, that results in more than a
<br />remote likelihood that a material misstatement of the financial statements will not be prevented or detected by the City of
<br />Paris, Texas', internal control.
<br />Our consideration of internal control over financial reporting was for the limited purpose described in the first paragraph
<br />of this section and would not necessarily identify all deficiencies in internal control that might be significant deficiencies
<br />or material weaknesses. We did not identify any deficiencies in internal control over financial reporting that we consider
<br />to be material weaknesses, as defined above.
<br />Compliance and Other Matters
<br />As part of obtaining reasonable assurance about whether the City of Paris, Texas', financial statements are free of
<br />material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts, and
<br />grant agreements, noncompliance with which could have a direct and material effect on the determination of
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<br />AMERICAN INSTITUTE OF CERTIFIED PUBLIC ACCOUNTANTS
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