Borough accepts FY2024 audit after BDO flags procurement gap and single‑signature check

The Bristol Bay Borough Assembly voted on Feb. 19 to accept the borough's fiscal year 2024 audit after a presentation by BDO's assurance practice leader. The auditor said BDO issued an unmodified (clean) opinion on the borough's financial statements but reported a material weakness and two compliance findings that the borough must address.

BDO told the assembly the audit was completed more quickly than in prior years and that, while the firm issued a clean opinion, it proposed a set of adjustments and identified internal-control deficiencies. "We did issue an unmodified opinion on the financial statements," the BDO assurance practice leader said, noting the audit provides "reasonable assurance, not absolute assurance." The auditor added that several corrected misstatements were posted, including adjustments for landfill prior-period balances, tax receivable allowances and removal of obsolete landfill equipment.

The auditor flagged a material weakness tied to one check for $609,000 that had a single signature despite a borough policy requiring two signers for checks over $5,000. "We did report it as a material weakness," the auditor said, and explained the firm expanded its sampling and did not identify other instances but classified the item as a material control deficiency because of the amount and the existing policy.

On compliance testing, BDO reported two items of noncompliance or findings: a Federal Funding Accountability and Transparency Act (FAFATA) subaward report for the borough clinic was not filed in time for FY2024 (it was later filed in mid-2025), and the auditor could not find documentation showing a competitive bidding process for a $750,000 contract to replace an elementary school gym roof. The auditor said the state paid for and approved the project but that procurement paperwork demonstrating compliance with state competitive‑bid requirements was not located in the borough's records.

Manager James Wilson told the assembly some procurement records dated to 2019 and that staff had limited ability to locate older documents: "Some of that information we couldn't find ' developed or it replaced a couple years before I even got here," he said, urging improved processes and record retention going forward.

Assembly members asked questions about the single-signature check and why the Management Discussion & Analysis (MD&A) was omitted from the filing; BDO said the MD&A had been left out previously while the borough worked to catch up on timely reporting and that the firm and management intend to return it when reports are current. The auditor also recommended tightening general-ledger access so fewer users can prepare, post and review journal entries without independent review.

An assembly member moved to accept the FY2024 audit from BDO; the motion was seconded and adopted by voice vote, after which the mayor announced, "Motion carries." No public commenters spoke at the meeting. The assembly set its next regular meeting for 7 p.m. on March 2.

What the audit means: the unmodified opinion indicates the financial statements are, in BDO's view, free of material misstatement for FY2024, but the report identifies clear process and documentation gaps the borough must remedy. The auditor included a corrective-action plan and recommended management and the assembly treat the material-weakness control issue and the procurement-documentation finding as priorities to prevent recurrence.

The assembly accepted the audit as presented. Staff and the auditor said they plan follow-up work and a likely in-person review of FY2025 numbers in a future work session.