Pittsylvania County audit: unmodified opinion; federal test finds untimely Medicaid verifications with no dollar impact
Loading...
Summary
County auditors issued an unmodified (clean) opinion on the FY2025 financial statements and recommended monitoring several fund declines; federal testing found untimely Medicaid eligibility verifications in social services, which were corrected and produced no benefit impact.
The Pittsylvania County Board of Supervisors heard a presentation on Dec. 16 from the county's independent auditors, who issued an unmodified opinion on the FY2025 financial statements and highlighted one federal compliance finding in social services.
Scott Wakeham, the partner in charge of the county audit, told the board the county received an "unmodified opinion, which is the best opinion you can get," and walked through the audit highlights and new accounting standards that affected this year's presentation.
The auditors said implementation of GASB 101 (compensated absences) required recording additional accrual liabilities, increasing the county's liability for sick leave by roughly $1.5 million and the school-board-related liability by about $10 million. Wakeham emphasized the change is an accounting liability and "no impact on your operations." He also noted the county's net pension liability is roughly $7 million while the school teacher portion is about $47 million and that those pension figures are sensitive to actuarial assumptions.
On federal compliance testing under uniform guidance, Wakeham said auditors identified one finding in social services related to untimely Medicaid eligibility verifications. "They had not been done timely...it did not impact anybody's benefits," Wakeham said, adding that staff performed the needed verifications when auditors raised the issue and that social services has implemented a process aimed at preventing recurrence.
The presentation included trend data showing that, while total assets have been relatively even over five years, operating expenditures are growing faster than revenues and certain internal funds showed cash declines. Wakeham flagged a $1.3 million decrease in the solid waste cash balance, a $1.3 million decline in the health insurance fund and a $400,000 increase in the water and sewer fund as items to monitor.
On reserves, he reported the county's unassigned fund balance was about 19.65% of operating expenditures in 2025, above the Government Finance Officers Association's general minimum guidance of roughly 16.67%. When asked about a target, Wakeham recommended considering a policy moving toward at least 20% and possibly toward 25%, suggesting a phased approach during budget cycles.
The board had follow-up questions about the Medicaid finding and fund-balance targets; Wakeham reiterated the eligibility issues produced no dollar impact and encouraged monitoring the noted cash declines. The audit team also issued a short letter of recommendations included with the full 177-page report.
What happens next: the auditors left copies of the report with staff and offered to answer further questions; the board will consider budget implications as it moves into the FY2027 budget process.
