Yavapai County auditors issue clean FY2025 opinion, flag IT and federal compliance findings

Auditors contracted by the Arizona Auditor General told the Yavapai County Board of Supervisors on June 3 that the county received a clean, unmodified opinion on its FY2025 financial statements, while also flagging deficiencies the board must address.

Jay Park of Walker & Armstrong, the contracted firm, told the board the audit covered three deliverables: the annual comprehensive financial report, the single-audit reporting package for federal awards and a required-communications letter to governance. Park said the county's total governmental cash was reported as $235,368,000 (figures reported in the presentation are in thousands), an increase of about $4.3 million from 2024, and he highlighted an unrestricted net position of $8.7 million as a favorable liquidity indicator.

"Based on our audit, we issued what's referred to as a clean or unmodified opinion on the financial statements," Park said. He told the board payroll-related costs drove much of the year-to-year expense growth and noted capital outlays and depreciation changes that affected net position.

But Park and Arizona Auditor General staff also briefed supervisors on findings: auditors identified one material weakness (based on magnitude), two significant deficiencies tied to financial reporting, repeat findings on cash-investment reconciliations and information-technology control weaknesses. The single-audit portion found three compliance issues related to the Workforce Innovation and Opportunity Act (WIOA) cluster: a quarterly report that was not filed, failures to meet earmarking requirements and delayed monitoring that occurred months after year-end.

Connie Dekemper, the county finance director, and Carla Wall of the Auditor General's office joined Park for the presentation; Dekemper acknowledged the repeat items but said some prior-year issues had been corrected. "We did see improvements," Park added, pointing to one previously reported finding that was resolved this audit cycle.

Supervisors pressed for follow-up details. Supervisor Koopnell asked how much of cost growth reflected inflation versus new spending; Park said he did not have a multi-year inflation split immediately available but would provide it on request. When supervisors pressed about the large pension and OPEB unfunded liabilities (the audit listed those obligations at roughly $172.4 million), auditors said the annual required contribution (ARC) includes components to cover both current service and portions of unfunded liabilities but that the exact split requires actuary data.

The audit presentation recommended improved reconciliations, clearer segregation of duties for account signatories, strengthened IT risk assessments and tighter controls over system access and configuration. Park said management's corrective actions and responses are attached to the single-audit reporting package and that some IT corrective steps were already underway in 2026.

The county accepted the report and asked staff to bring back additional breakdowns requested by supervisors, including inflation-adjusted expense drivers and further actuarial detail related to pension funding.

The board did not take immediate formal action on the audit at the meeting beyond receiving the presentation; staff said the final audit report was issued in March 2026 and that the audit contained no adjusting journal entries from the auditors.