Salt Lake City receives clean financial‑statement opinion; auditors flag ERP conversion reporting weakness and federal schedule omission

Auditors presented the city’s FY2024 financial‑statement audit to the Salt Lake City Council on Feb. 18 and delivered a clean (unmodified) opinion but disclosed control and reporting issues related to the city’s transition to the Workday enterprise resource planning system.

Opinion and key findings - Audit opinion: Eide Bailly reported an unmodified (clean) opinion on the city’s government‑wide and major‑fund financial statements. - Reporting and internal control: auditors identified a material weakness tied to reporting and account reconciliations during the Workday conversion. Auditors said the transition produced delays and adjustments in the city’s account reconciliations and that the city experienced reporting delays during the implementation. - Adjustments: corrected audit adjustments included small entries to accrued compensation, fair‑value adjustments to investments, and a reclassification of housing receivables. Auditors also identified an immaterial prior‑period misstatement related to revenue recognition that management did not correct because it was immaterial to users. - Federal reporting: auditors said the schedule of expenditures of federal awards (SEFA) omitted certain programs during initial submission; the auditors added the program to the single audit testing universe. After testing, auditors reported no findings in the single‑audit compliance work (no federal‑compliance findings). - State compliance: auditors reported two state‑compliance issues: the city filed a cash‑management report late and with incorrect balances to the state money‑management council during the transition; auditors also noted the council did not consistently receive quarterly financial statements during the conversion period. Auditors said management is implementing corrective actions and that those items will be followed up in the next audit cycle.

City response City finance staff acknowledged the conversion to Workday made the year’s audit more complex and said the organization is implementing corrective actions, including improved reconciliations, reporting cadence and monitoring. Staff said they will file required corrective‑action plans with federal and state auditors and will report progress to the council.

What this means The clean financial‑statement opinion indicates the city’s year‑end statements present fairly in all material respects. The material weakness and state‑reporting issues reflect transitional problems tied to a major IT implementation, which auditors and staff said are largely administrative and subject to corrective action. The single‑audit, which tests major federal programs, produced no reportable federal compliance findings.

Speakers and attribution: Eide Bailly auditors Haley St. Michael and Michael Mickelson presented the report; City Controller and finance staff answered council questions during the briefing.