Pensacola auditors report unmodified opinion; housing voucher documentation deficiency flagged

City auditors presented the City of Pensacola's annual comprehensive financial report for the year ended Sept. 30, 2025, and the independent auditor delivered an unmodified opinion, the highest level of assurance.

Kristin McAllister of Warren Averett told council the financial statements "present fairly, in all material respects" and the firm did not identify material weaknesses or significant deficiencies. She said the city expended approximately $50,000,000 in federal awards and $30,000,000 in state financial assistance during the year, and governmental fund balances totaled about $100,000,000 — an increase of roughly $9,000,000 from the prior year.

McAllister also reported a targeted compliance finding related to the housing voucher program: in a review of 40 tenant files auditors found three instances where documentation did not adequately record why third-party income verification was not obtained. She said alternative verification methods were used in those cases, income was calculated correctly, and there were no improper housing-assistance payments as a result.

Staff described a corrective action plan to address the documentation gap, including a review of all housing income-verification files and steps to ensure the reason for using alternate verification is recorded going forward. A staff member said the review covered every file for voucher applicants to document the method of income verification and that they achieved 100% compliance in the follow-up review.

Council accepted the audit report after questions from Council Vice President Breyer; the acceptance vote was recorded as 7-0.

What happens next: staff will continue implementing the corrective action plan for housing voucher documentation and will be available to report follow-up at future meetings.