San Miguel County receives clean 2024 audit; $6 million infrastructure accounting adjustment noted

San Miguel County received an unmodified ("clean") audit opinion for its 2024 financial statements, auditor Jim Hinkle told the Board of County Commissioners at their Sept. 17 meeting in Norwood. Hinkle of Hinkle and Company said the firm found no significant deficiencies or material weaknesses in the county's internal control structure.

The auditor told the board the audit used substantive testing of account balances and supporting documents and that the opinion indicates the statements were prepared in accordance with generally accepted accounting principles. "Yours is technically referred to as an unmodified opinion. And in layman's term, that's a clean opinion," Hinkle said.

Why it matters: a clean audit helps the county meet state and federal filing requirements and maintain public confidence in its financial reporting. The audit also identified restatements tied to capital asset accounting that change the county's net position by roughly $6 million. Hinkle said those changes stemmed from inconsistent historical valuation methods for infrastructure and right-of-way assets; some right-of-way values had been held at an apparent current (not historical) value and were adjusted downward, while right-of-way values that had been omitted for certain unimproved roads were added back at historical cost.

The auditor recommended that management continue to own the capital-asset accounting process and noted county staff led an in-depth effort to assemble and validate historical information the prior auditors had maintained. Hinkle said the additional time spent on capital-asset accounting explains why the audit was finalized in September rather than July. "Management's responsibility is preparation of annual financial statements. Our responsibility as auditors is to verify those financial statements," he told the board.

Hinkle also reported clean results on the county's single-audit work for federal award programs. Two major programs were tested — Lawson Hill Trail and County Road bridge replacement — and the auditors found no instances of noncompliance with the federal Uniform Guidance.

The county's finance director, Ramona Rummel, told the board staff intends to finalize remaining language edits and file the audit documentation with the Colorado State Auditor's Office and the Federal Audit Clearinghouse by the Sept. 30 deadlines. Commissioners offered verbal acknowledgment and thanks to finance staff; no formal acceptance vote was required before filing, the auditor said.

Ending: The board did not take formal action to approve the audit at the meeting; staff said they will proceed with required filings this month and will provide the final report to the commissioners when complete.