Auditors issue unmodified FY24 opinion; city’s general fund remains strong despite declines

Ken Meadows of Greenfinney, Collie, and LLP presented Easly City’s fiscal year 2024 audit, saying the firm issued an unmodified opinion on the year’s financial statements and that the audit was not a forensic review into fraud. "We issued an unmodified opinion," Meadows stated during the work session.

Meadows told the council the general fund decreased by about $3.4 million to roughly $10.3 million at June 30, 2024. After removing nonspendable prepaids (about $1.9 million) and assigned capital (about $900,000), the city’s unassigned general fund balance stood near $7.5 million—about 33% of actual FY24 expenditures. Meadows said that level is well above Government Finance Officers Association guidance and “I would characterize it as a healthy fund balance in the general fund.”

On revenues, Meadows reported general fund receipts of about $18.6 million, driven by license and permit receipts (~$6.0 million), local option sales taxes (~$4.5 million), and property taxes (~$3.8 million). Revenues rose about $1.4 million (≈8.2%) from the prior year, largely because of higher local property taxes.

Expenditures for the general fund totaled about $22.7 million; public safety accounted for roughly $9.0 million, general government about $4.8 million, and public works about $3.6 million. Meadows attributed much of the year-over-year spending increase to ARPA-funded expenditures that were recorded in the fiscal year and to increased public-safety costs.

Meadows also summarized other major funds. The hospitality tax fund closed the year with roughly $4.1 million (including restricted bond proceeds and debt-service reserves and about $3.1 million restricted for recreation and tourism). The impact-fee fund collected about $728,000 in FY24, spent about $165,000, and increased to about $2.0 million; Meadows emphasized these funds are restricted to specified public-safety, parks/recreation and transportation uses per the fee study.

On proprietary operations, the stormwater fund posted an improved position—net position of about $3.3 million with operating revenues of about $452,000 and operating income near $145,000. Meadows said infrastructure contributions from developers were recorded as capital additions; the meeting transcript contains an apparent transcription error for the single-line numeric amount reported, which the auditor clarified in discussion.

From a compliance perspective, auditors repeated a material weakness and a compliance finding carried from the prior year related to timely bank reconciliations and court fine accounting. Meadows said bank reconciliations had been completed more recently and that outstanding court fines had been addressed in FY24. He explained a prior $80,000 cash variance was resolved through adjustments when reconciling accounts after a period without a finance director.

Meadows closed by describing routine audit adjustments and interfund transfers (for example, a grant fund transfer that offset general-fund-recorded expenditures). The council asked follow-up questions on impact-fee restrictions and the prior reconciliations; Meadows answered each and provided page references in the financial statements for more detail.

The audit presentation ended with Meadows reaffirming the unmodified opinion and that, overall, the city’s financial statements were materially correct as presented.