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Amarillo council files audit after CLA delivers "clean" opinion; single-audit findings, CIP questions prompt calls for follow-up
Summary
Independent auditors gave Amarillo an unmodified ("clean") opinion on the city's FY2025 financial statements, but reported two material audit adjustments and nine single-audit findings tied to federal/state grants. Council filed the ACFR and asked staff for clearer corrective-action tracking; public speakers renewed calls for a forensic review focused on CIP and ARPA spending.
The Amarillo City Council voted June 23 to file the city's Annual Comprehensive Financial Report after auditors from CliftonLarsonAllen (CLA) presented an unmodified opinion on the FY2025 statements and detailed follow-up items the city must address.
CLA's managing auditors told council the financial statements fairly present the city's fiscal position. The general fund ended FY2025 with an audited balance of $47.8 million, down from a beginning balance of $69.6 million, a net change of negative $21.8 million. Water and sewer operating revenues were about $100.9 million for the year; unrestricted net position in that enterprise was roughly $35 million, the firm said.
The auditors also reported two material audit adjustments (revenue recognition timing and leases receivable) that were significant enough to be categorized as a material weakness in internal control. In addition, CLA identified nine findings in the federal/state single-audit portion, including one grant-related issue at the airport: records did not clearly tag which capital assets were purchased with federal funds. That specific compliance item could produce a qualified opinion on that major program, the auditors said.
Council members pressed auditors and finance staff on the items that produced those adjustments. CLA pointed to receivables that were not collected within the 60-day window required for revenue recognition and to leased assets recorded in government-wide statements but not in the general fund. The auditors emphasized these adjustments were corrected in the issued ACFR and said the unmodified opinion stands.
Public comment and several council members pressed staff for stronger follow-up. "We're required to report corrective action plans for single-audit findings," CLA advised; council asked staff to present regular progress reports and timelines on remediation. Several speakers, including residents and frequent budget critics, urged a separate forensic audit of capital improvement project (CIP) spending after city staff earlier identified about $43 million in open CIP projects.
Staff and auditors agreed on next steps: the single-audit report and management's corrective-action plan will be issued as a separate, soon-to-be-published document; staff will return to council with a more formal tracking process for corrective actions. Council ultimately voted to file the final ACFR with the city secretary after an initial tie vote on acceptance; a subsequent motion to file passed 4-0.
What's next: staff will deliver the single-audit findings and the city's corrective-action plan when available and provide ongoing updates on remediation work. Forensic-audit requests will require a separate scope, vendor selection and council direction; staff said it would return with cost and scope estimates if council asks for a dedicated forensic review.
