Independent auditors give town 'unmodified opinion' but flag control weaknesses; commission directs finance to tighten policies

Pembroke Park commissioners heard the town's annual audit on Wednesday and were told the fiscal year ended Sept. 30, 2024, produced financial statements that auditors deemed reliable but showed internal control problems that need correction. "We did issue an unmodified opinion that your financial statements are fairly presented in all material respects," auditor Zach Shalifour said during the presentation of James Moore & Company's report. That is the highest assurance the firm can give.

The audit identified two material weaknesses related to the timeliness of reconciliations and late audit adjustments, and three significant deficiencies involving accounts payable reconciliations, purchasing procedures and capital asset reconciliation, Shalifour told the commission. He said some issues dated to prior years and that timing of the auditor transition meant some fixes already underway could still appear in next year's report.

Why it matters: the town's general fund showed a total fund balance of about $9.25 million and an unassigned (unrestricted) fund balance equal to roughly eight months of operating expenditures, well above the Government Finance Officers Association's two-month minimum. The auditors also reported a nearly $3 million prior-period restatement to correct items that had been recorded incorrectly in fiscal 2023, and a net pension liability tied to the Florida Retirement System of about $5 million.

Commissioners pressed for follow-up steps. Finance Director James Zaverman confirmed staff will prepare policy changes and internal-control fixes; the commission directed the finance department to work on those policies and return with proposed actions and a timetable. "We have some findings that we need to address on internal controls and just creating policies so that we can eliminate those," a commissioner said, and the town manager assigned responsibility to the finance director.

The auditors also noted required state reports and a management response included at the back of the audit document addressing each comment. Town staff said they have applied for the Government Finance Officers Association's (GFOA) certificate of achievement and will continue to work with the auditors on scheduling and on getting the next audit into a normal calendar rhythm.

Ending note: auditors said the town is financially stable overall but needs the operational steps the commission requested. The commission set a direction for finance to draft policies, meet with auditors as needed, and present progress at an upcoming meeting.