Multnomah County accepts annual financial report and clean audit, auditors note limited findings

The Multnomah County Board of Commissioners on an agendaed session accepted the county's Annual Comprehensive Financial Report for the fiscal year ended June 30, 2024, and acknowledged an accompanying audit report from external auditors Moss Adams that issued an unmodified opinion.

The audit outcome matters because a clean opinion supports the county's eligibility for federal and state grants and helps sustain the county's creditworthiness, County Chief Financial Officer Eric Arellano told the board. "Our financial statements received an unmodified opinion," Arellano said, meaning the statements were presented in accordance with generally accepted accounting principles and Governmental Accounting Standards Board guidance.

Ashley Austin, partner with Moss Adams, summarized the external review for the board. She told commissioners the firm conducted standard verification and compliance procedures, reviewed internal controls and the county's federal single-audit programs, and found no reportable fraud, waste or abuse. Austin said there were no corrected or uncorrected audit adjustments and no disagreements with management about accounting matters.

Moss Adams and county staff did identify two limited issues the board will address. First, auditors reported a state compliance finding required by Oregon's minimum audit standards: the Facilities Management Fund went over budget by $388,000 and that overage must be disclosed in the financial statements. Second, the single-audit work found a significant deficiency in internal controls related to the county's allocation of internal service charges to federal awards; auditors said the county applied budgeted allocations without performing a post-year-end lookback to confirm those allocations materially matched actual costs.

Audit committee members who oversaw the process praised the transparency and rigor of the review. "The process was surprisingly transparent," said Jerry Walker, vice chair of the Multnomah County Audit Committee. Audit committee member Mary Annick Jagappan said committee members had extensive opportunity to review the auditors' work and ask questions before the report came to the board.

The board passed a resolution that formally acknowledges receipt of the Annual Comprehensive Financial Report and accepts the audit report. Commissioner Brown Edwards moved approval of R1; Commissioner Singleton seconded. A roll-call vote recorded the resolution as approved by the commissioners present.

The board directed County management and the CFO to implement recommendations from the external auditors and resolve the compliance and internal-control findings. Arellano told the board he will follow the same remediation routine used in prior years and return with status updates.

Key speakers during the presentation included Eric Arellano, chief financial officer; Cora Bell, deputy chief financial officer; Ashley Austin, partner, Moss Adams; and audit committee members Jerry Walker and Mary Annick Jagappan. The audit committee and the external auditor noted the clean opinion supports grant eligibility and bond-rating considerations and that the two reported issues are limited in scope and are subject to remediation.