Honorable Mayor and
Members of the Borough Council
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in
the financial statements. The procedures selected depend on the auditor's judgment, including the
assessment of the risks of material misstatement of the financial statements, whether due to fraud or
error. In making those risk assessments, the auditor considers internal control relevant to the entity's
preparation and fair presentation of the financial statements in order to design audit procedures that are
appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness
of the entity's internal control. Accordingly, we express no such opinion. An audit also includes
evaluating the appropriateness of accounting policies used and the reasonableness of significant
accounting estimates made by management, as well as evaluating the overall presentation of the financial
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for
our audit opinions.
Basis for Adverse Opinion on U.S. Generally Accepted Accounting Principles
As described in Note 1 of the financial statements, the financial statements are prepared by the Borough
of Milford on the basis of the financial reporting provisions prescribed by the Division of Local
Government Services, Department of Community Affairs, State of New Jersey, which is a basis of
accounting other than accounting principles generally accepted in the United States of America, to meet
the requirements of New Jersey.
The effects on the financial statements of the variances between the regulatory basis of accounting
described in Note 1 and accounting principles generally accepted in the United States of America,
although not reasonably determinable, are presumed to be material.
Adverse Opinion on U.S. Generally Accepted Accounting Principles
In our opinion, because of the significance of the matter discussed in the "Basis for Adverse Opinion on
U.S. Generally Accepted Accounting Principles" paragraph, the financial statements referred to above
do not present fairly, in accordance with accounting principles generally accepted in the United States
of America, the financial position of each fund of the Borough of Milford as of December 31, 2012 and
2011, or changes in financial position for the years then ended.
Basis for Qualified Opinion on Regulatory Basis Accounting Principles
We are unable to obtain sufficient evidence to support the cost of fixed assets. As more fully describe
in Note 1, due to the length of time over which these fixed assets were acquired, it is not practical to
determine their actual costs. We are, therefore, unable to express an opinion as to the general fixed
assets account group at at December 31, 2012, and 2011, stated as $5,031,771.00 and $4,532,934.00,