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Alma City receives clean FY2025 audit; fund balance rises, auditors flag budgeting of multiyear projects
Summary
Auditors issued an unmodified (clean) opinion on Alma's FY2025 financial statements and reported a roughly $630,000 increase in fund balance to about $6.34 million; they identified one material finding advising the city to budget multiyear projects across fiscal years.
Alma City commissioners received the city's comprehensive annual financial report for fiscal year ending June 30, 2025, and accepted an audit that the auditor described as an unmodified (clean) opinion.
"We did issue this year an unmodified audit opinion," auditor Allie Barnes said during her presentation, noting the audit contained no management comments or significant deficiencies but one material weakness tied to budgeting practice.
Barnes said the city reported roughly $6.1 million in total revenue for the fiscal year, down from about $6.8 million the prior year, and that the general fund's fund balance increased by about $630,000 to approximately $6.34 million. She reviewed utility funds as well, reporting the wastewater fund's net position near $11.6 million and the water fund's net position near $10.9 million; the water fund held about $2.8 million in cash and investments. On long-term obligations, Barnes said the net pension liability was about $8.0 million, or roughly 71.2% funded.
Barnes described the audit's single material finding as a budgeting issue on a multiyear capital project: "When you have multi-year projects, you still need to factor in all the years with any kind of cash flow analysis," she said, explaining that budgeting an entire multi-year project in one fiscal year can technically produce an adopted budget that shows a deficit fund balance, which state law prohibits. Her recommendation was to budget only the portion expected to be spent in each fiscal year and track the remainder in the capital improvement plan.
Commissioners praised city staff for preparation and accepted the audit report (motion to receive the report carried by voice vote). The auditor said the city's accounting and supporting documentation allowed the audit team to issue the unmodified opinion and to resolve the one finding with the recommended budget-handling change.
The commission's formal acceptance means the audit record and the stated recommendation are part of the city's official minutes; staff said they will incorporate the recommendation into future budgeting and capital project planning.
