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Council approves submission of 2025 annual financial report after staff corrects multi-year accounting error
Summary
Finance director presented the draft 2025 annual financial statements, explained fund transfers and BARS reporting, and reported correction of a historical error that had skewed earlier filings by about $85,000 per year; council approved the report for submission.
Finance director Kosan presented the draft 2025 annual financial statements to the Medical Lake City Council on May 19 and answered council questions about fund transfers, BARS reporting codes and repeated line items in the state format.
Kosan explained that some funds show transfers (for example, $960,000 into the Streets Fund) that reflect internal movement of resources between funds rather than new external revenue. He said the city follows the state’s BARS (Budgeting, Accounting and Reporting System) account structure, which can produce repeated line items in the annual report export because each activity is recorded separately for auditing and comparability.
Kosan also told council he had identified and corrected a recurring error dating from 2018–2020 that had produced a roughly $85,000 annual discrepancy in the schedule six reconciliation; he said the 2025 statements were the most accurate the office had produced to date.
Council asked clarifying questions about specific fund line items and the usefulness of reorganizing GL exports to reduce repetition; Kosan said consolidation would be possible but could reduce reporting detail auditors require. After discussion council moved and approved submission of the 2025 annual report for filing.
The motion to approve the submission carried by voice vote. Staff will file the accepted annual report with the State Auditor and incorporate clearer presentation ideas into future budget and reporting work.
