Chesterfield County receives clean audit; auditor cites treasurer reconciliation delays during software conversion

An independent auditor told the Chesterfield County Council on April 1 that the county's 2024 financial statements received an unmodified opinion, while a single internal-control finding was issued for delayed bank reconciliations in the treasurer's office.

"You had $62,800,000 in total in assets," Stephanie Khan of Holiday & Schwartz told the council, providing the financial highlights. "Nineteen million of that was sitting in cash, and 17,600,000 of that was sitting in investments." Khan said the county shows $25.2 million in capital assets (net of depreciation) and total liabilities of $48.4 million, producing a net position of $14.9 million, an increase of $6.3 million from the prior year.

Khan said the auditors issued a finding in the single-audit report because some of the treasurer's main bank accounts were not reconciled on a timely monthly basis during the audit period. The delay, she said, was tied to the treasurer's office converting to new finance software.

"We did see a significant delay in performing our audit. And I think most of you are aware it had to do with the treasurer's office getting their accounts reconciled," Khan told the council. She said the county's software conversion was the contributing factor and that she did not expect the finding to recur next year.

The auditor reported no disagreements with management, no uncorrected misstatements and no consultations with other accounting firms. The auditors tested federal programs under the Single Audit Act, including ARPA and CDBG spending, and found no findings on federal compliance.

Khan walked the council through selected line items: long-term debt of $9.9 million (of which $2.3 million is due within one year), $5.6 million in unearned revenue (largely ARPA funds not yet spent), a net pension liability of $18.6 million and an OPEB liability of $10.4 million. She explained that pension and OPEB amounts are actuarial valuations required for government financial reporting and are not immediate cash demands.

On the general fund, Khan said revenues were $33.2 million for the year ended June 30, 2024—about $4.8 million higher than the prior year—and the county finished the year with a favorable budget variance partly because a planned $2.4 million transfer from capital reserves was not needed. She cautioned that the county's unassigned general fund balance alone is smaller than typical guidance (roughly half a month of expenditures), but when capital reserves are included the county's reserve position is approximately 11 months.

Council members did not take formal action on the audit during the meeting; Khan offered to answer follow-up questions and provided contact information.

The auditor recommended continued attention to the treasurer's reconciliation processes as the office completes its software conversion, and the council heard that Pedagod/finance staff expect the reconciliation issue to be resolved in the coming year.

Ending

Khan closed by reiterating the unmodified audit opinion and the expectation that the reconciliation finding should not recur once the treasurer's office completes its conversion to new financial software. Council members thanked the audit team and then moved on to other agenda items.