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City auditor gives Osage Beach a clean opinion; board debates water and sewer reporting
Summary
Hood & Associates presented the cityof Osage BeachFY2024 annual comprehensive financial report and single-audit, issuing an unmodified (clean) opinion. Auditors recommended cross-training and an assets inventory; aldermen asked staff to separate water and sewer reporting in future audits.
Hood & Associates CPAs presented the City of Osage Beachannual comprehensive financial report for fiscal 2024 to the Board of Aldermen on July 17 and issued an unmodified opinion, commonly known as a clean audit opinion.
The audit presentation, led by Michael Keenan of Hood and Associates, said the cityreceived a clean opinion and identified no material weaknesses in internal control or reportable noncompliance with finance-related laws. The firm noted one major federal program for single-audit purposes: expenditures related to American Rescue Plan Act (ARPA) funding. Auditors also offered management recommendations on cross-training key employees, conducting a physical inventory of capital assets, and considering raising the capitalization threshold from $2,000 to $5,000.
The audit report accompanied the citypacket and Hood & Associates highlighted that the city has received the Government Finance Officers Association certificate of excellence in financial reporting for 25 consecutive years and that the 2024 report was submitted for that award.
The board also heard a midyear financial update. City Administrator Devon Lake told the board that through June 30 sales tax is down 2.44% from the same period last year and 1.9% under budget; overall expenditures are 19% under budget while total revenues are about 10% under budget.
Discussion focused on how the city reports utility funds. Several aldermen, led by Alderman Recker and followed by Aldermen Osteen and others, asked why the audit combines water and sewer into a single reported fund even though internal accounting keeps them separate. Finance Director Carrie Bell said the two funds have been combined in external reporting since the SRF financing about 20 years ago but that staff can provide separate figures; she said the city maintains separate internal accounting and can provide a combining schedule or separate presentation in future audits.
Aldermen said separating water and sewer in external reporting would make it easier to review rates and answer public questions. Bell and staff agreed to prepare a draft approach and to provide the separate balances for 2024; staff also offered to add a combining schedule later in the financial statements so the information is available without changing the current aggregated presentation immediately.
The auditors and staff answered technical questions during the meeting; Keenan emphasized the audit uses a risk-based sampling approach and therefore provides reasonable but not absolute assurance. Hood & Associates also noted cybersecurity and continuing policy reviews as ongoing areas for city attention.
The board took no formal action on the audit at the meeting beyond receiving the presentation and asking staff to return with separated water and sewer balance details and with the draft job description referenced later in the agenda for a proposed project manager position.
