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Audit committee reviews FY26 plan; GASB changes, single-audit threshold noted
Summary
The Vermont State Colleges audit committee heard the FY26 audit plan from external auditors, who reported an unmodified prior-year opinion, highlighted a prior single-audit finding on information-security documentation, noted a federal major-program threshold increase to $1 million, and outlined fieldwork dates in August.
Zach Laflash, audit partner at Wither Smith and Brown, told the Vermont State Colleges Audit Committee that the FY25 audit concluded with an unmodified opinion and no material weaknesses and reviewed the firm’s plan for the FY26 audit. Laflash said the team will continue a primarily remote approach but will perform fieldwork the weeks of Aug. 17 and Aug. 28 and maintain regular check‑ins with college finance staff.
Laflash said the FY25 single-audit included a finding that the college’s written information‑security policies lagged behind practice and that college staff have been updating and formalizing those policies. “We did not identify any internal control issues last year,” Laflash said, and added that any newly identified control weaknesses would be reported to management and the committee.
The auditors noted a change in the federal single‑audit major‑program threshold from $750,000 to $1,000,000, which could reduce the number of programs requiring separate testing; Laflash said student financial aid will continue to be treated as a required annual major program. He also briefed the committee on two new GASB pronouncements: GASB 103, which restructures management’s discussion and analysis and revises some revenue/expense classifications, and GASB 104, which expands capital‑asset disclosures including assets held for sale. Laflash said the audit team will work with college staff to align the FY26 financial statements and MD&A with the new requirements.
Trustee Dery asked whether the GASB changes will increase preparatory work; Laflash said MD&A will require more advanced preparation but he did not expect the changes to affect the financial statements or the audit opinion materially.
Laflash also reviewed audit risks typical for higher education, including going concern assessments and testing of large, unusual transactions, and described the firm’s approach to tailoring procedures based on the committee’s assessment of internal controls. The committee asked no further follow‑up and requested ongoing progress reports from the audit team.
Next steps: the audit team will complete planning procedures and selections in May, continue testing in subsequent months, and perform scheduled fieldwork in August, with the goal of completing the financial‑statement audit by the October reporting deadline.
