State auditors outline scope, timeline and resources for Tacoma's 2025 financial and federal audits

Judy Lee, assistant audit manager with Team Tacoma at the Washington State Auditor's Office, and Jason Starr, the auditor in charge, briefed the Joint Performance, Finance and Audit Advisory Board on June 2 about the scope, schedule and public resources for the city's 2025 audits.

Lee said the State Auditor's Office audits public funds across Washington and provided the board with a packet of materials to follow the presentation. Starr said the financial-statement audit and the federal single audit both cover the 2025 fiscal year, from Jan. 1, 2025, through Dec. 31, 2025, and that the office will issue an opinion on whether the financial statements are fairly stated.

"The purpose of the financial statement audit is to issue an opinion on whether the statements are fairly stated and materially correct so that users of the financial statements can rely on them," Starr said.

Starr told the board the single audit will test major federal programs selected under federal thresholds; he said the office will include five major programs for 2025. He described the Uniform Guidance-based risk assessment process used to identify which programs require testing, noting that programs not audited within the past three years are treated as higher risk and that prior-year single-audit findings increase the coverage required.

"If one of those A-type programs had a finding in the prior year, especially if it's a material finding, that's an indicator of high risk, so we'll include that in our risk assessment," Starr said.

On financial-statement risks, Starr said the office did not identify unusual significant risks beyond the standard concern about management override of controls. He characterized that concern as a routine, standard risk auditors consider when planning testing.

Board and council members asked process questions during a brief question-and-answer period. One member asked whether federal granting agencies might disagree with state audit conclusions; Starr replied that federal agencies set compliance requirements and often perform their own audits of programs when appropriate. Another member asked how the office avoids conflicts from long staff assignments; Starr said the SAO has a policy that cycles a manager or audit lead off an assignment after five years.

Starr said the single-audit deadline is at the end of September and that the exit conference for the financial and single audits will likely occur in September. He pointed listeners to the SAO's website, where audit reports, the Financial Intelligence Tool, trainings and other resources are posted, and referenced a new fraud-prevention resource called "Follow the Money."

The board had no further questions, thanked the State Auditor's Office team and moved to adjourn. The motion to adjourn was seconded and the chair called the meeting to a close.