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Cherryville auditor delivers unqualified opinion; city reports stronger fund balances
Summary
Independent auditors told the Cherryville City Council they issued an unqualified (clean) opinion on the city—s financial statements, reported a year-over-year increase in the general fund and said a single audit was required because of federal and bond funds.
Sheila Portman, the audit manager from Butler and Stowes, told the Cherryville City Council the firm issued an unqualified opinion on the city—s financial statements and that the city met state and federal audit requirements.
Portman said the audit work began in August, was completed before the Oct. 31 filing deadline, and that the Local Government Commission (LGC) had approved the filing. She told council members the audit was a state single audit because of federal funds and bond proceeds the city received.
Portman reported the general fund increased by $683,343 for the year and that the city—s unassigned General Fund balance at June 30 was about $3.0 million, representing 38.4% of annual general fund expenditures. She also said the city—s electric, water and sewer enterprise funds had a combined net increase for the year and that, overall, the city—s assets exceeded liabilities at year-end. Portman invited council members to ask for additional details from the full audit report, which she said runs roughly 90 pages and includes a compliance section listing grant revenues and expenditures.
Council members asked follow-up questions about the reported increases and fund balances. Portman answered that the unassigned fund balance has risen in recent years (about 18% in 2022, 31% in 2023, and 38% in the current year, as she reported) and confirmed the city currently holds bond proceeds tied to Main Street projects.
Portman said the general fund still holds approximately $616,030 in Main Street bond proceeds and the water and sewer enterprise fund held about $2.7 million at June 30, figures she presented as part of the audit highlights. Council members discussed the need to spend bond proceeds on eligible projects to avoid potential federal interest/repayment issues tied to unused bond funds.
Portman closed by offering to answer any additional questions and giving council members access to the full audit for detailed review.
The presentation required no council vote; council members thanked Portman for the briefing and confirmed they would review the audit materials further.
