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Finance director briefs council on 2023 audit: net position up, restatements made, new ERP planned
Summary
Deputy City Administrator/Finance Director David Goldman presented the 2023 audit results: net position increased by about $12 million, staff restated classifications of fund balances and investments to align with GASB guidance, and the city plans ERP implementation and revised procedures to prevent recurrence.
Finance Director David Goldman presented the city’s 2023 audit results in an information session Jan. 7. The report to council was informational; no council action was required.
Key findings: Goldman said the city’s overall financial condition improved in 2023 and reported that net position increased by about $12 million. Staff restated certain 2023 financial statements to correct classifications of fund balances and the allocation of investments between funds; those technical reclassifications changed line-item presentations but did not change total assets, liabilities or net position.
Standards and corrective steps: Goldman said the restatements addressed GASB Statement No. 54 fund-balance classifications (nonspendable, restricted, committed, assigned, unassigned) and an allocation of investments that the state auditor asked the city to implement going forward. The finance team updated standard operating procedures, will implement additional staff training and expects to use a new enterprise resource planning (ERP) financial-management system to streamline future closings and reporting.
Investment performance: Goldman presented preliminary figures showing the city earned about $2.7 million in investment interest in 2023 and preliminary 2024 investment earnings of about $3.75 million; he cautioned that 2024 numbers were preliminary. He said statewide municipal investments rose substantially from 2022 to 2023 and the city’s investment totals followed that trend.
Next steps and context: Staff will continue to work with the Washington State Auditor’s Office, publish corrected financials and program the new ERP to reduce manual year-end processes. Council members asked clarifying questions about investment earnings and implementation timing; Goldman said ERP implementation work is expected to extend through the next year and new procedures will be in place for 2025 reporting.
