Auditor gives Union County an unmodified opinion; county records opioid settlement receivable

Union County's FY2025 financial statements received an unmodified (clean) audit opinion, and county finance staff presented highlights including changes in cash and investments, spending of bond and ARPA proceeds and an increase in long-term receivables tied to the state-handled opioid settlement.

Dan Gaugherty, the audit partner from Cherry Bectert, summarized the audit approach and results and told the board the firm "issued an unmodified opinion on the financial statements back in November." He said auditors found no material weaknesses or significant deficiencies in internal control for the financial statements and that single-audit compliance work on certain federal and state grants remained in progress.

Gaugherty described an accounting adjustment tied to the opioid settlement, saying "This 13,900,000.0 has now been recorded as a receivable on your books" and explained the state's treatment caused the county to change its classification of the transaction. Finance Director Beverly Lyles said the county's financial statements recognized the settlement on the government-wide level and that the county added about $15,000,000 to accounts receivable this fiscal year primarily because of that settlement; she noted the settlement proceeds are not scheduled to be received in full until 2039.

Lyles also highlighted major year-to-year changes: a decrease in cash and investments of about $93 million attributable to spending previously issued bond proceeds for school projects and drawing down ARPA funds for the Crooked Creek project; an increase in capital assets (about $45 million) tied primarily to water-and-sewer projects and donated infrastructure; and an overall decrease in general-fund balance of roughly $1.9 million. She reported $22.5 million in unassigned general-fund balance and noted that education receives the largest share of county expenditures (about 35%), followed by public safety (20%).

On the water-and-sewer side, Lyles reported operating revenues of about $85 million and expenditures of around $87 million (including depreciation), nonoperating revenues of roughly $25 million, system-development fees of about $11.5 million and donated water-and-sewer assets of roughly $22 million.

Gaugherty said auditors did not identify fraud, legal acts or going-concern issues as of the presentation date. The county adopted a new accounting standard for compensated absences during the year, which had no material effect on net position. The single-audit component (federal/state compliance testing) remained working-level and expected to be completed shortly.

The board thanked staff and moved on to the next agenda items; no formal board action on the audit was recorded beyond receiving the presentation.