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Auditor issues clean opinion for Navasota; general fund drawdown was planned
Summary
An external audit for fiscal year 2025 was delivered with an unmodified (clean) opinion. Auditor highlighted a planned $1.1 million drawdown of the general fund, a 31% unassigned reserve, and several internal-control recommendations that management is implementing.
An external auditor presented the fiscal year 2025 audit to the Navasota City Council and issued an unmodified—commonly called a "clean"—opinion on the city’s financial statements.
During the presentation the auditor summarized the audit approach and outcomes and emphasized that "the city did receive unmodified opinion. That's often referred to as a clean opinion." The auditor also reported no independence issues and said audit adjustments identified were being corrected by management.
Key figures highlighted for council included a planned general fund decrease of about $1.1 million (a budgeted drawdown aligned with the council’s plan), a positive budget-to-actual variance on expenditures of roughly $584,000 (under budget for the year), and an overall general-fund unassigned-reserve equal to about 31% of annual operating expenses (above the council’s 25% target). The capital projects fund increased by nearly $2 million due to a bond issuance for upcoming projects. In proprietary funds, water and sewer operations showed net operating income while the gas fund experienced a loss; the auditor and staff said a rate study and a recent three-year gas contract are expected to help future results.
The auditor reviewed two required communication letters—one to those charged with governance and a separate internal-control communication—that contained a few recommendations. Management indicated it has begun implementing those recommendations and thanked staff for work that enabled issuance of the report on schedule.
No formal vote was taken at the workshop on audit acceptance; the report was presented and management will continue to address minor audit recommendations and internal-control improvements.
