JAMES MAISER

CERTIFIED PUBLIC ACCOUNTANT & CONSULTANT

44 West First Street, Waconia, MN 55387 Office: 952-442-4807 Fax: 952-442-6888

INDEPENDENT AUDITOR'S REPORT

Board of Supervisors

Mille Lacs Soil and Water Conservation District

Milaca, Minnesota

I have audited the accompanying financial statements of the governmental activities and

the General fund of the Mille Lacs Soil and Water Conservation District, Milaca,

Minnesota as of and for the year ended December 31,2006 which collectively comprise

the District's basic financial statements as listed in the table of contents. These financial

statements are the responsibility of District management. My responsibility is to express

opinions on these financial statements based on the audit.

I conducted the 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 I plan and perform the audit to obtain reasonable

assurance about whether the financial statements are free of material misstatement. An

audit includes examining, on a test basis, evidence supporting the amounts and

disclosures in the financial statements. An audit also includes assessing the accounting

principles used and significant estimates made by management, as well as evaluating

the overall financial statement presentation. I believe that my audit provides a

reasonable basis for my opinions.

In my opinion, the financial statements referred to above present fairly, in all material

respects, the respective financial position of the governmental activities and the General

fund of the Mille Lacs Soil and Water Conservation District, Milaca, Minnesota as of

December 31,2006, and the results of operations and the respective budgetary

comparison for the General fund for the year then ended in conformity with accounting

principles generally accepted in the United States of America.

The management's discussion and analysis information is not a required part of the

basic financial statements but it is supplementary information required by accounting

principles generally accepted in the United States of America. I have applied certain

limited procedures, which consisted principally of inquiries of management regarding the

methods of measurement and presentation of the required supplementary information.

However, I did not audit the information and express no opinion on it.

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In accordance with Government Auditing Standards, I have also issued a report dated

August 31, 2007 on my consideration of the District's internal control over financial

reporting and on my tests of its compliance with certain provisions of laws, regulations,

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