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Auditors give Boulder City a clean FY24 opinion but flag a significant year-end control deficiency
Summary
Audit partner Chad Atkinson told the Boulder City Audit Review Committee on Jan. 9 that auditors issued an unmodified (clean) opinion on the FY24 financial statements but recorded one significant deficiency (2024-001) tied to year-end accounting controls during a staffing transition; management says it has hired new staff and will strengthen documentation and cross-training.
Audit partner Chad Atkinson told the Boulder City Audit Review Committee on Jan. 9 that the independent audit of the city’s fiscal year 2024 financial statements resulted in an unmodified (clean) opinion but included one significant deficiency related to year-end accounting and financial statement controls.
Atkinson said the auditors and city staff identified several adjustments after the trial balance was submitted, leading to the reportable finding 2024-001. "We issued an unmodified opinion or clean opinion on the financial statements," he said, adding that the finding stemmed from year-end accounting handoffs during a staff transition.
Finance Director Cynthia Sneed told the committee the city experienced a staffing change during the year — "Kyle" left and "Amara" joined after the fiscal year end — and attributed the finding to that transition. Sneed said the city has hired Amara, is improving documentation and will implement cross-training and a more robust project plan to reduce the risk of a similar issue.
Beyond the finding, Atkinson reviewed major financial highlights from the CAFR: the net change in total governmental fund balances was about $10.7–$10.8 million (down from $14.6 million the prior year); revenues rose by roughly $6.4 million, driven by about $1.6 million in increased ARPA grant receipts and roughly $1.6 million from regional transportation commission revenues. Investment income was up about $2.5 million. In the enterprise funds, operating revenues were up about $1.0 million while operating expenses rose about $6.6 million, including a $4.0 million increase in electricity purchases and $1.2 million in salaries and benefits. Capital grants in the aviation fund were approximately $7.1 million.
Atkinson described the City’s liquidity positions: governmental cash of about $102.1 million and business-type cash of about $66.0 million. The general fund’s unassigned balance rose from about $25.8 million to $26.4 million (roughly 7.75 months of reserves), while the utility fund had about 20 months of operating reserves. Sneed noted the CAFR figures reflect activity through June 30 and do not yet reflect a subsequent $9.0 million transfer approved by voters and a standing $1.0 million annual CIP transfer.
After discussion, the committee voted unanimously to recommend that City Council accept the FY24 audit and CAFR. A committee member moved to accept the audit report for fiscal year 2024; Sneed seconded, and the motion passed with all in favor. The committee will forward its recommendation to the City Council for final action.
The audit and committee discussion identified corrective steps (hiring, cross-training and documentation) as management’s response; the committee did not table or modify the audit opinion. The committee indicated it will monitor management’s corrective-action plan going forward.
