Auditors give Aberdeen a clean opinion for 2024 but report three material weaknesses; council re-engages I. Bailey for future audits

Auditors reported an unmodified (clean) opinion on the City of Aberdeen’s fiscal year 2024 financial statements and on compliance for the city's major federal program, but identified three internal control deficiencies categorized as material weaknesses — the same findings the auditor reported in the prior year. Cameron Zent, partner at I. Bailey, told the council the three material weaknesses involved auditor assistance in preparation of financial statements and the schedule of expenditures of federal awards, recurring audit adjustments, and capital-asset reporting. The audit presentation described two new government accounting standards implemented for FY24 (GASB 101 on compensated absences and GASB 102 on certain risk disclosures). Under GASB 101 the city recorded an additional liability for an extended leave bank; the auditor said this change was not material to the financial statements. Cameron also presented high-level fund results: combined cash and investments near $44 million, general fund revenues of about $30.5 million (75% from property and sales taxes), a general fund year-end fund balance of $13.6 million (about 58% unassigned), and stronger operating income in the water and sewer enterprise funds. Council members asked about staffing and whether another CPA position was warranted; the auditor said improvements have occurred over several years and recommended further process improvements rather than immediately adding a full-time CPA. No federal compliance findings were reported in the single-audit portion; the Airport Improvement Program (AIP) was tested as the major federal program. Separately, the council approved staff’s recommendation to accept a proposal from I. Bailey and enter a master services agreement for audit services through 2027. Roll-call votes on the engagement recorded unanimous approval. Discussion vs. decision: The audit presentation was informational; the council then took a formal vote to accept I. Bailey’s proposal for audits in 2025–2027 and authorize the city to enter into the agreement. Ending: Councilmembers thanked city finance staff and the auditors for their work and noted continued focus on reducing audit adjustments and improving capital-asset records.