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City auditor issues clean opinion on FY2023–24; two compliance findings noted
Summary
External auditors told the Ogden City Council they issued an unmodified opinion on the city's FY2023–24 financial statements and the federal single audit, but flagged two state-compliance findings: an unassigned general fund balance above the 35% state limit and an over-budget narcotics strike-force fund.
Jeff Miles, auditor with HBME, told the Ogden City Council on Jan. 7 that the firm issued an unmodified, or clean, opinion on Ogden's financial statements for the fiscal year ended June 30, 2024, and a clean federal single-audit opinion for the COVID-19 relief spending they tested.
The audit presentation noted the city spent about $3 million of its COVID-19 relief funds during FY2024 and that auditors found those expenditures complied with U.S. Treasury guidelines. Miles said auditors found no material weaknesses or significant deficiencies in internal control testing, which covered cash receipts and disbursements, capital assets, payroll and financial reporting.
The nut graf: the auditors concluded Ogden's financial reporting is reliable but identified two state-compliance issues that the city must address. The first is a statutory limit on unassigned general-fund balances: auditors said Ogden's unassigned fund balance was 39.42% of budgeted revenues at June 30, 2024, above the 35% threshold. The second finding was that the Weber-Morgan Narcotics Strike Force Fund exceeded its budget by about $53,000 after an unanticipated grant was spent without a corresponding budget amendment.
Miles told council the higher-than-expected fund balance largely reflected unrealized investment gains that were required by accounting rules to be recognized at fiscal-year end, increasing reported revenues after the budget closed. He said the audit committee and staff discussed the items and that management provided written responses. Miles read management's response saying the city concurs and will reduce the fund balance in the FY2025 budget and monitor unrealized gains monthly.
Councilors asked whether staff had an action plan; Miles pointed to management's written response and the city27s plan to amend budgets and monitor funds. Council member Haier made a motion to accept the audit report for review; council member Myers seconded the motion. The voice vote was unanimous to accept the report for review.
The council scheduled a deeper review of the audit reports during a Feb. 18 work session.
Ending: The audit presentation, and the corrective steps management described, put the emphasis on monitoring investments and amending budgets promptly when unanticipated grants arrive to avoid future state-compliance exceptions.
