Westminster receives unmodified audit opinion for fiscal 2024; single audit required after USDA loan conversion
January 14, 2025 | Westminster City , Oconee County, South Carolina
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Will Walls, audit manager at Love Bailey and Associates, told the Westminster City Council on Jan. 14 that the firm issued an unmodified opinion on the city’s fiscal year 2024 financial statements.
Walls said the audit “was not a forensic audit” and that the firm “had no discoveries of fraud for the 2024 audit.” He explained the city received the highest standard of opinion an auditor can provide: “you received an unmodified opinion, which which means that the financial statements are materially correct, and all generally accepted accounting principles.”
City financial highlights presented by Walls showed total general-fund revenues rose about $256,000 from 2023, driven largely by higher intergovernmental receipts (Oconee County fire allocation measured at about $550,000 in 2024 versus $285,000 in 2023). Miscellaneous receipts declined about $394,000 after the 2023 sale of assets, while interest income rose about $200,000 because the city held more money in the local government investment pool and rates rose from roughly 4% to 5.57%.
On the expenditure side, Walls said public-safety spending increased roughly $303,000, mostly for salaries as the number of full-time positions with salaries over $20,000 rose from 39 in 2023 to 44 in 2024. Capital outlay declined about $335,000, with major 2023 purchases listed as two police vehicles, public-works trucks and a recreational scoreboard. Walls reported a $5.1 million net increase in the general-fund balance for the year and an ending general-fund balance at June 30, 2024, of about $6.6 million; unrestricted cash and LGIP balances were about $1.6 million.
For the city’s proprietary (enterprise) funds — electric, sewer, water and solid waste — operating revenues rose about $209,000. Walls attributed part of that increase to tap fees tied to development (he cited roughly $95,000 from a project called Sphinx and about $198,000 from a new neighborhood, Heirloom Farms). Operating expenses in the proprietary funds fell about $711,000 as materials purchases for a major water project were higher in 2023 than in 2024. Walls also noted $462,000 of ARPA funding recorded to the utilities fund in 2024. The proprietary fund recorded higher interest expense after the city entered an $8.26 million bond anticipation note, and Walls said that liability was later rolled into a USDA loan — a conversion that caused the city to meet the federal threshold for a single audit.
Because the USDA conversion qualifies as federal expenditures above the single-audit threshold, the city completed a single audit; Walls said the single audit produced no findings. Overall, Walls described the audit results as positive, noting no internal-control findings for 2024 (the city had two or three findings the prior year) and “no major adjusting journal entries” that caused concern.
Walls closed by pointing to a measured decline in the city’s months of cash on hand — a commonly used liquidity metric — from about 3.3 months at June 30, 2023, to about 2.6 months at June 30, 2024. He and staff reiterated the typical municipal best practice of maintaining roughly three months of operating cash on hand to cover timing differences in receipts and obligations.
The presentation packet provided to council members includes a two-year comparison schedule, the schedule of federal expenditures and the detailed audit report; council members asked for the larger packet to be displayed in a larger font for readability.
Walls said the audit “was not a forensic audit” and that the firm “had no discoveries of fraud for the 2024 audit.” He explained the city received the highest standard of opinion an auditor can provide: “you received an unmodified opinion, which which means that the financial statements are materially correct, and all generally accepted accounting principles.”
City financial highlights presented by Walls showed total general-fund revenues rose about $256,000 from 2023, driven largely by higher intergovernmental receipts (Oconee County fire allocation measured at about $550,000 in 2024 versus $285,000 in 2023). Miscellaneous receipts declined about $394,000 after the 2023 sale of assets, while interest income rose about $200,000 because the city held more money in the local government investment pool and rates rose from roughly 4% to 5.57%.
On the expenditure side, Walls said public-safety spending increased roughly $303,000, mostly for salaries as the number of full-time positions with salaries over $20,000 rose from 39 in 2023 to 44 in 2024. Capital outlay declined about $335,000, with major 2023 purchases listed as two police vehicles, public-works trucks and a recreational scoreboard. Walls reported a $5.1 million net increase in the general-fund balance for the year and an ending general-fund balance at June 30, 2024, of about $6.6 million; unrestricted cash and LGIP balances were about $1.6 million.
For the city’s proprietary (enterprise) funds — electric, sewer, water and solid waste — operating revenues rose about $209,000. Walls attributed part of that increase to tap fees tied to development (he cited roughly $95,000 from a project called Sphinx and about $198,000 from a new neighborhood, Heirloom Farms). Operating expenses in the proprietary funds fell about $711,000 as materials purchases for a major water project were higher in 2023 than in 2024. Walls also noted $462,000 of ARPA funding recorded to the utilities fund in 2024. The proprietary fund recorded higher interest expense after the city entered an $8.26 million bond anticipation note, and Walls said that liability was later rolled into a USDA loan — a conversion that caused the city to meet the federal threshold for a single audit.
Because the USDA conversion qualifies as federal expenditures above the single-audit threshold, the city completed a single audit; Walls said the single audit produced no findings. Overall, Walls described the audit results as positive, noting no internal-control findings for 2024 (the city had two or three findings the prior year) and “no major adjusting journal entries” that caused concern.
Walls closed by pointing to a measured decline in the city’s months of cash on hand — a commonly used liquidity metric — from about 3.3 months at June 30, 2023, to about 2.6 months at June 30, 2024. He and staff reiterated the typical municipal best practice of maintaining roughly three months of operating cash on hand to cover timing differences in receipts and obligations.
The presentation packet provided to council members includes a two-year comparison schedule, the schedule of federal expenditures and the detailed audit report; council members asked for the larger packet to be displayed in a larger font for readability.
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