Auditor issues clean opinion but flags internal control and year‑end adjustments

Brad Paul, a partner at ABDO, told the Kenyon City Council that the firm is issuing an unmodified — or "clean" — opinion on the city's 2024 financial statements, meaning the auditor believes the statements are materially accurate and presented in accordance with generally accepted accounting principles.

Paul summarized the audit team's higher‑risk review areas — revenues (taxes and state aid), debt service expenditures, payroll and capital purchases — and said the audit identified three findings. Two were typical for a small city: limited segregation of duties because of a small staff and routine year‑end adjustments. "We are issuing an unmodified or clean opinion on your financial statements," Paul said.

Paul said auditors made material audit adjustments to year‑end balances after reviewing trial balances and account classifications; he described these as correcting miscoding or reallocating balances rather than indicating fraud. He recommended combining certain external game accounts with city accounts to simplify monthly reconciliations (a change staff expected to have implemented since year‑end).

On fund balances, Paul noted the city has a formal policy to hold an unassigned fund balance at roughly 40% of the general fund budget. Revenues were largely on budget in 2024 (including an unbudgeted ~ $30,000 in state aid), he said, while overall expenditures ran about $250,000 over budget — the police department accounted for the biggest variance at roughly $140,000 — and council should watch reserves during the upcoming budgeting cycle.

Council moved and approved Resolution 2025‑17 to accept the audited financial statements as presented.

Next steps: council and staff said they will continue routine reconciliation work, review the separation of duties where possible, and consider Paul’s recommendations ahead of next year’s budget work.