Council and finance commission receive and file two years of city financial reports after auditors issue unmodified opinion
Loading...
Summary
City auditors gave an unmodified opinion on South Pasadena’s financial statements for the years ending June 30, 2024 and June 30, 2025, while identifying repeat internal-control issues; council and the finance commission voted to receive and file the reports and staff outlined corrective steps.
South Pasadena officials on Wednesday received and filed the city’s Annual Comprehensive Financial Reports (ACFAR) for the years ended June 30, 2024 and June 30, 2025 after a presentation by the city’s accounting manager and outside auditors.
Accounting manager/controller Mark Secrete introduced the item and said the Finance Department had worked “diligently to catch up on financial reporting matters that have been backlogged due to staff turnover.” Rob Pearl of CliftonLarsonAllen told the council the firm rendered an unmodified opinion — the highest audit opinion — on the financial statements.
Pearl said the audit included required communications about internal control and noted some repeat issues. He flagged a material weakness in financial closing and reporting and identified areas needing improved project-level construction progress detail, bank reconciliation timeliness and budgetary compliance for a special projects fund. “We’ve downgraded [bank reconciliation] to a significant deficiency because of the improvement that we’ve seen,” Pearl said, while recommending further steps to shorten the bank-reconciliation timeline toward 30–60 days.
Finance staff described progress since June 2025. Secrete said the department has filled vacancies and implemented processes that have shortened reconciliation timelines to roughly 45–60 days in recent months. He and other staff detailed an upgrade to a cloud-based Springbrook accounting system and related budget-reporting tools they expect to complete in stages over the coming months, and said those steps are designed to build procedural controls into daily workflows.
Council and the Finance Commission voted to receive and file the audit reports. The joint vote recorded eight yes votes, one abstention and one absence. No reportable corrective actions were adopted at the meeting beyond staff’s commitment to continue implementing the improvements described.
The city will submit the ACFAR to the Government Finance Officers Association for consideration of a certificate of achievement in financial reporting after the council’s receipt.
