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Auditor: Town in good financial position but urges ledger fixes and reimbursement rule for school grants
Summary
An auditor told the town its fiscal 2025 finances are sound but recommended accounting-system improvements, noted large OPEB and pension liabilities and urged the school department to request federal-grant reimbursements only after related expenses are incurred.
An auditor presenting the town's fiscal 2025 results said the town is in a good financial position but recommended changes to accounting practices and grant handling to reduce future risk.
The auditor said the town's unassigned fund balance stood at $15,450,000 and that total revenues came in about $3,400,000 higher than expected while total expenditures were about $1,867,000 under budget, producing a favorable net variance the auditor described as roughly $5,288,000. "Town is in a good financial position," the auditor said.
The presentation flagged long-term liabilities. The auditor reported a net pension liability of $35,546,000 and said the town bears roughly 84% of that amount, with the housing authority and the electric division accounting for the remainder. On retiree health obligations, the auditor said the town's total OPEB liability was being estimated near $141,000,000 while the town's OPEB trust fund balance was about $11,000,000, producing a low funding ratio the auditor gave as 7.8%.
The auditor also described capital-asset changes: capital assets net of accumulated depreciation were reported at $88,681,000, with capital-asset additions of about $16,300,000 offset by roughly $6,500,000 in depreciation, for a net increase of about $9,900,000 from the prior year. Long-term bonds and notes payable were reported at $22,494,000; the town made roughly $2,900,000 in principal payments and incurred about $2,800,000 in new debt.
On accounting operations, the auditor said there is room to improve the general ledger structure and reduce manual tracking. The management letter contained four recommendations this year (down from six last year), and one identified issue was that the town has not fully implemented GASB Statement No. 84 in its general ledger. The auditor recommended adjusting the general ledger so it can calculate interyear balances for special revenue and capital project funds instead of relying on manual processes.
A new audit component addressed school federal grant fund balances. The auditor said audit procedures found expenditures charged to older federal grants whose performance periods appeared to have expired, and that the school department had been requesting reimbursements before incurring related expenses. The auditor recommended the school department request reimbursement only after the corresponding expenses have been incurred: "We're recommending the school department handle these grants on a reimbursement base, and only request reimbursement after the corresponding expenses have been incurred," the auditor said. The transcript refers to the entity as the school department; the meeting identified no further officials for those remarks.
The auditor closed by thanking staff for their cooperation: "I'd like to thank Stacy, her team, and anybody who worked with us on the audit," the auditor said, praising the preparation that helped the audit proceed smoothly.
No formal votes or binding decisions were recorded during the presentation; the auditor's recommendations were presented for the town's consideration and potential follow-up implementation by town finance staff and the school department.
