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Staff recommends closing FY2023 audit with disclaimer after system transition left missing closing entries
Summary
Staff and the county auditor told the HLVRA board that a financial-system transition left some closing entries missing; because auditors lack sufficient information, staff recommended closing the FY2023 audit with a disclaimer and addressing adjustments in FY2024.
Staff told the board that the FY2022–FY2023 audit work remains unresolved because the county transitioned financial systems and some final closing entries were not migrated. PricePage (auditor) said there is not enough information to form an opinion for FY2023 and staff presented two options: continue working with the auditor to supply additional documentation or close the audit with an auditor's disclaimer and address entries in the next fiscal year.
County auditor Stephanie Naranek explained the operational issue: "Our old system crashed, and we weren't able to put in those final closing entries," and said the county and HLVRA staff have provided supporting documentation but the auditor may still be unable to reach an opinion for FY2023. Staff said they have extended time for the auditor and that closing FY2023 with a disclaimer is likely the practical path forward, then focusing on clean records and efficiencies in FY2024 under the county's confirmed audit processes.
Board members asked whether baseline account balances remain intact and whether the missing information is limited to documentation of how entries were recorded. Staff replied that the balances are likely known but the journal-entry detail that links transactions to fiscal years is the missing element; PricePage indicated those omissions can be addressed by making adjustments in later years if auditors accept that approach.
Why it matters: an auditor's disclaimer signals auditors could not form an opinion due to insufficient information, which can complicate financial transparency and grant reporting. Staff said they plan to reconcile and document transactions in FY2024 with county support and recommended moving forward rather than prolonging the current audit process.
The board directed staff to continue work with the auditor as appropriate and accepted staff's recommendation to move toward closing the FY2023 audit with a disclaimer and addressing items in the next audit cycle.
