Auditor gives Glanek Lane a clean opinion for FY2025 but flags longstanding segregation-of-duties issue

An external audit of the City of Glanek Lane's fiscal year ended April 30, 2025, produced clean, unmodified opinions on the city's basic financial statements and on federal compliance testing, but auditors noted one recurring internal-control finding related to segregation of duties.

The audit matters because it confirms the city's financial statements are presented fairly on the modified cash basis and shows the city met the federal single-audit threshold after spending more than $750,000 in federal awards this fiscal year. The report also identifies an internal-control weakness the city should address to reduce risk.

Josh Furburg, senior manager with Whitley (the audit firm), presented highlights of the audit. “You guys have a clean, unmodified opinion on the financial statements,” he said, noting the city uses a modified-cash basis of accounting. He also said the city received an unmodified opinion on compliance for federal programs after expending about $832,000 in federal awards tied to drinking-water capitalization grants from the EPA.

On internal control, Furburg said auditors reported one finding for improper segregation of duties, a condition the audit firm has noted in prior years. “There's not someone else looking at the bank reconciliation,” he explained in response to a council question about the finding, describing the absence of an independent reviewer for reconciliations.

Financial highlights the auditor presented included a net pension asset of about $291,000 as of the December 31 actuarial valuation (about 102% funded), approximately $1.7 million of principal paid on long-term debt during 2025, and governmental revenues driven largely by intergovernmental receipts (about 68% of revenue) with property taxes at roughly 19%.

Furburg explained a notable one-time increase in net income for enterprise-type funds in 2025, driven by capital contributions, including about $832,000 tied to the EPA grant and multiple transfers into enterprise funds (street, Turner Hall, swimming pool). He encouraged council members to contact the audit firm for questions and noted the city finance director’s work was “clean.”

Discussion and follow-up: Council members asked for clarification about the segregation-of-duties finding; auditors said it stems from a lack of an independent review of bank reconciliations. The audit presentation did not include council action; staff and auditors said they will follow up on the finding and that the city will consider controls to provide independent review.

• Clarifications: The single-audit was required because federal award expenditures exceeded the $750,000 threshold; no federal compliance violations were reported in the audit.