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Loudoun audit: independent auditors issue unmodified opinion, county posts stronger net position
Summary
County auditors issued an unmodified (clean) opinion for FY2025 and reported a stronger net position, higher-than-budgeted general fund revenues, and no material weaknesses; staff and auditors described accounting standard changes and a $4 million immaterial uncorrected misstatement.
The Finance, Government Operations and Economic Development Committee heard the results of Loudoun County's fiscal year 2025 audit on Dec. 9, when auditors from Cherry Beckert (presented by partner Malav Sheth) and county finance staff said the county received an unmodified (clean) audit opinion.
The county's government-wide net position rose to about $3.5 billion in FY2025, an increase of roughly $163 million (about 4.8%) from the prior year, officials said. The county's general fund revenues exceeded the revised budget by $154.9 million (about 5.7%), while expenditures were below the revised budget by $74.7 million (about 2.6%). The unassigned general fund balance available for appropriation stood at $194.4 million.
Auditor Sheth told the committee the firm issued an unmodified opinion and did not identify any material weaknesses or significant deficiencies in internal controls this year. The audit report also flagged two new GASB accounting standards implemented by the county: GASB 101 (affecting compensated absences and increasing the liability recognized for various leave accruals) and GASB 102 (primarily disclosures). Sheth said the implementation led to a $41 million increase to beginning net position related to compensated-absence valuation.
Sheth reported one immaterial uncorrected misstatement of about $4 million that management declined to record because it was immaterial to the financial statements; auditors concurred. The audit team also said it will issue a future opinion on federal awards in January or February relating to federal expenditures and compliance.
Interim Director of Finance and Procurement Elaine Crawford said the results reflect a strong fiscal year and noted that the county had increased its fiscal reserves by $22.5 million to reach a total reserve of $340 million, consistent with the county's fiscal policy goal of maintaining reserves equal to 10% of operating revenues for county and schools.
Committee members thanked staff and the audit team and asked technical questions about upcoming GASB changes and the difference between the auditors' phrasing ('unmodified') and everyday language (often called a 'clean' opinion). Sheth explained that 'unmodified' is the technical term for the highest level of assurance auditors provide and that such an opinion still represents reasonable — not absolute — assurance.
The presentation was informational and did not go to the full Board from the committee; staff and auditors said they would follow up on detailed questions about internal accounting estimates and on the forthcoming federal awards opinion.
