Stafford EDC auditor issues clean opinion; board accepts audited financial statements

The Stafford Economic Development Corporation accepted audited financial statements for the fiscal year after Portillo, Brown & Hill issued an unmodified (clean) opinion.

Portillo, Brown & Hill audit partner Chris Pruitt told the board the audit was performed in accordance with GAAP and GAAS and that “the financial statements, in our opinion, are materially stated correctly. It’s called an unmodified opinion, also referred to as a clean opinion.” He said the audit found no items that could cause a material misstatement and no disagreements with management.

The auditor highlighted the corporation’s fund balances and major revenue sources. Pruitt said the corporation’s total ending fund balance is about $18,000,000, with an unassigned (available) fund balance of roughly $7,000,000; the remainder is committed for debt service or capital projects. He identified sales tax as the largest revenue source — “a little bit over $6,000,000” — and said the audit confirms the sales-tax receipts with the state comptroller. On the budget, Pruitt said the corporation was “about $835,000 better off than what you thought at the beginning of the year” after higher-than-expected sales-tax and interest income offset greater-than-budgeted expenditures.

Finance staff added detail. Miss Shaw summarized July-year-to-date results: combined ending fund balance was $2,623,039 higher than the prior year; total cash and investments were about $21,700,000; about 20% was in a government pool called LOGIC and nearly 28% in brokered CDs and similar investments. Year-to-date interest received was $666,591 and accrued interest receivable $148,626. Shaw also provided fund-level breakdowns: the operating fund’s year-to-date sales-tax net of rebate was reported as $5,600,000 (13.09% higher than the previous year), and transfers to debt service and capital projects were reported with specific amounts.

Board members asked for clarifications about a budget variance related to economic development expenditures and administrative-service allocations. Pruitt said he did not identify a material concern and offered to follow up on line-item detail for the $354,000 of higher-than-budgeted operating costs. Shaw said audited fund balances will be used in next year’s final budget and that she will forward required resolutions to finalize the budget.

After the presentations and brief Q&A, a motion to accept the audited financial statements as presented was made and approved unanimously.

Looking ahead, staff said upcoming accounting-standard changes included in the auditor’s communications will be circulated to management to allow time for preparation.