Willington auditors issue clean FY2025 opinions; town reports $10.3 million in fund balances

At the June 18 Willington Board of Finance meeting, auditors from Mahoney Sable presented the town's fiscal year 2025 audit and said they issued unmodified (clean) opinions on the financial statements and on compliance for major federal and state programs.

The audit partner, Mike Vandur, told the board the audit was performed under AICPA and GAO government auditing standards and included federal and state single-audit testing because of the level of grant funding. He said federal awards expended were just over $1 million — with the American Rescue Plan (ARPA) funds identified as the major federal program — and state financial assistance totaled approximately $4.4 million, including a town road grant and the Small Town Economic Assistance Program. "We did issue unmodified clean opinions on compliance over the use of those funds," Vandur said.

The auditors reported the town's combined ending fund balances at about $10.3 million, an increase of roughly $1.5 million from the prior year. The general fund ended with about $4.4 million (a modest decrease year over year), of which roughly $2.2 million was unassigned. On a governmentwide basis, the town's unrestricted net position was reported at about $8.2 million; the net pension position was a small asset (approximately $50,000). The auditors also noted an actuarial OPEB liability of about $960,000 funded on a pay-as-you-go basis.

Vandur summarized the town's budgetary results: the board had budgeted to use $900,000 of fund balance but actually used about $533,000, producing a favorable budgetary variance of about $366,000. Revenues exceeded budget by approximately $287,000, helped by stronger collections for property taxes, conveyance taxes, building permits and interest on short-term investments.

On required communications, the auditors reported no material weaknesses, no significant audit adjustments and no disagreements with management. They issued a governance letter and said a one-month extension was requested and approved by OPM to allow management additional review time prior to issuance. Vandur also disclosed the firm provided limited non-audit services (financial statement preparation and related schedules) and that management (Donna, the town business manager) accepted responsibility for those non-audit services to preserve independence.

Board members used the presentation to press auditors on policy choices. Members asked whether more aggressive use of fund balance was appropriate to blunt tax impacts; the auditor advised that fund balance is typically reserved for non-recurring items such as capital expenditures rather than ongoing operations and noted that rating agencies consider fund-balance levels and the town's tax base composition when assessing bond ratings. "The use of fund balance should really be more for non-recurring type expenditures, capital expenditures, as opposed to using that as a way to balance your budget," Vandur said. He added rating agencies will look at factors including the town's limited commercial tax base and lower fund-balance percentage when determining ratings.

The audit team said they were available to answer follow-up questions and encouraged the board to route inquiries through the chair and the business manager. The meeting concluded after public comment and routine business.