Get Full Government Meeting Transcripts, Videos, & Alerts Forever!
Get email alerts on the Municipal Finance topic
No spam. Unsubscribe anytime.
Fremont council receives FY2025 audit; auditor flags accounting standard change, $938K classification issue
Summary
Council accepted the City of Fremont’s FY2025 audited financial statements after Forvis Mazars issued a clean opinion and highlighted implementation of GASB 101 on compensated absences; auditors and staff said a roughly $938,000 misclassification reflects internal service fund allocation, not missing funds.
The Fremont City Council on April 14 received the audited financial statements for the fiscal year ended Sept. 30, 2025, after an audit presentation by Forvis Mazars and remarks from Finance Director Jennifer Nabb.
The auditor, Colby of Forvis Mazars, told the council the firm issued an unmodified (clean) opinion on the city’s financial statements but included an emphasis-of-matter paragraph related to the implementation of GASB Statement No. 101 for compensated absences, which required adjustments to how certain leave liabilities are reported. "We did issue a clean or unmodified opinion on those financial statements," Colby said, and added that the emphasis-of-matter calls out the new accounting standard the city implemented.
Colby also reported that the city’s single-audit compliance opinion for major federal award programs was clean. The Corona State and Local Fiscal Recovery Funds were the major program this year, with about $3.1 million expended and representing roughly 78% of the city’s federal expenditures subject to audit.
During Q&A, council members asked about an item described in the audit workpapers as roughly $938,000 tied to reporting between the city’s governmental funds and its utilities. The auditor and Finance Director Jennifer Nabb explained the amount reflects a classification decision in the internal service fund allocation rather than missing or misstated cash. "It is truly a misstatement between the classification of what's being reported as city funds versus utility funds," the auditor said, adding that the city elected to report certain internal service fund balances collectively for administrative efficiency rather than allocate them between reporting units.
Nabb reviewed key financial highlights for FY25: the city intentionally used some reserves this year as part of planned investments, expenses rose faster than revenues in several areas, and the city and utilities retained their bond ratings (City AA; Utilities AA−). She noted capital commitments of about $7.6 million on the city side (including police station and code enforcement projects) and explained that restricted and committed fund balances (for example, ARPA carryover and state Broad Street funds) will decline as planned projects proceed.
After discussion, Councilman Horner moved to receive the audited financial statements; the motion passed 8–0.
What happens next: The audit and supporting 81‑page financial statements will be posted on the city website and staff will continue work on rate studies and other actions described in the presentation.
