County accepts clean audit for 2023; auditors flag three recurring weaknesses

Pipestone County on Oct. 8 accepted an unmodified (clean) audit opinion for the year ended Dec. 31, 2023, after an audit presentation by Jamie Fay of Eide Bailly.

Fay told the board the firm issued a clean opinion after sampling transactions and testing internal controls. "The opinion was clean or unmodified, which is what you want," Fay said. She noted the county did not exceed the federal single‑audit threshold of $750,000 in federal expenditures, so no separate single audit was required.

The audit shows general‑fund revenues of about $11.8 million and expenditures of about $10.6 million, producing a net increase in general‑fund balance of roughly $1.2 million. The roads and bridges fund received about $8.8 million in revenues and had about $10.3 million in expenditures, producing a decrease of about $1.5 million.

Eide Bailly reported no Minnesota legal‑compliance findings, but the firm identified three material weaknesses that it commonly sees in smaller governments: insufficient segregation of duties, county preparation of financial statements (a technical complexity), and material journal entries that required auditor proposals to reach materially accurate balances. "We call them kind of the main three findings," Fay said, adding that those findings are common in smaller governments and often costly to remediate fully.

Commissioners discussed the findings and noted safeguards and sign‑off procedures that exist locally. The board moved and approved acceptance of the audit.

Fay also said Eide Bailly is stepping away from conducting county audits for Minnesota counties on its scheduling cycle, and county staff reported they have issued requests for proposals to find the next auditor. County finance staff will follow up on bids and vendor responses in the coming weeks.

The county accepted the audit and the meeting record reflects the board’s vote to adopt the 2023 financial statements.