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Milpitas audit returns clean opinion; council accepts annual financial report
Summary
The external audit for FY 2024–25 returned an unqualified (clean) opinion. The council accepted the annual comprehensive financial report and related audit documents; staff highlighted reserve increases and a planned federal single audit beginning in January 2026.
Finance Director Luz Cofresi Howe reported that external auditors (Mays and Associates) issued an unqualified, or "clean," opinion on the City's FY 2024–25 financial statements. The report package includes the ACFR, the memorandum on internal control, the agreed-upon procedures report, and notes that the federal single audit will begin in January 2026.
Key takeaways from the presentation included a citywide increase in net position of about $31.3 million driven largely by cash and investments, improved general-fund reserves (with contingency and budget-stabilization reserves increased to roughly the policy targets), and a general fund balance increase of about $4.2 million. The director said reserves for several purposes (PERS/pension, facilities, technology, turf replacement, and uninsured claims) are funded according to council policy.
Council asked questions about how one-time transfers (notably an ARPA/community investment transfer made in April 2024) affected the general fund totals; staff explained the transfer mechanism and committed to providing the underlying detail in follow-up materials. Several council members asked for clarification on terms (for example, the meaning of "unqualified"), which the finance director explained as auditor language for a clean opinion.
Council voted unanimously to accept the ACFR and related audited reports for the fiscal year ending 06/30/2025.
